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Debunking the Pinochet Smears Against Milton Friedman

Defaming Milton Friedman

By Johan Norberg
This article appeared in Reason Online on September 26, 2008

In the future, if you tell a student or a journalist that you favor free markets and limited government, there is a risk that they will ask you why you support dictatorships, torture, and corporate welfare. The reason for the confusion will be Naomi Klein’s book The Shock Doctrine: The Rise of Disaster Capitalism.

In a very short time, the book has become a 21st‐​century bible for anticapitalists. It has also drawn praise from mainstream reviewers: “There are very few books that really help us understand the present,” gushed The Guardian. “The Shock Doctrine is one of those books.” Writing in The New York Times, the Nobel‐​winning economist Joseph Stiglitz called it “a rich description of the political machinations required to force unsavory economic policies on resisting countries.”

Klein’s basic argument is that economic liberalization is so unpopular that it can only win through deception or coercion. In particular, it relies on crises. During a natural disaster, a war, or a military coup, people are disoriented, confused, and preoccupied with their own immediate survival, allowing regimes to liberalize trade, to privatize, and to reduce public spending with little opposition. According to Klein, “neoliberal” economists have welcomed Hurricane Katrina, the Southeast Asian tsunami, the Iraq war, and the South American military coups of the 1970s as opportunities to introduce radical free market policies. The chief villain in her story is Milton Friedman, the economist who did more than anyone in the 20th century to popularize free market ideas.

To make her case, Klein exaggerates the market reforms in question, often ignoring central events and rewriting chronologies. She confuses libertarianism with the quite different concepts of corporatism and neoconservatism. And she subjects Milton Friedman to one of the most malevolent distortions of a thinker’s ideas in recent history.

Exhibit A against Friedman is a quote from what Klein calls “one of his most influential essays”: “Only a crisis‐​actual or perceived‐​produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes politically inevitable.” This, says Klein, is “the shock doctrine.” In a not‐​very‐​subtle short film based on the book, the quote appears over images of prisoners being tortured.

The quote is not, in fact, from one of Friedman’s most influential essays; it’s from a very brief introduction to a reprint of his book Capitalism and Freedom. And it is not a rationale for welcoming disasters; it’s about the uncontroversial fact that people change their minds when the old ways seem to fail. Friedman provides a telling example, which Klein neglects to quote: Young Americans joined him in opposing the military draft after the Vietnam War forced them to risk their lives on another continent.

She also distorts other Friedman quotes to support her case. She pretends that Friedman’s concept of “the tyranny of the status quo” refers the tyranny of voters, and that he believed crises were needed to bypass the democratic process. But for Friedman, the tyranny was something entirely different: an iron triangle of politicians, bureaucrats, and special interest groups (businesses, for example) that deceive voters.

Discussing Friedman’s proposal to reduce inflation through sweeping market reforms, Klein writes, “Friedman predicted that the speed, suddenness and scope of the economic shifts would provoke psychological reactions in the public that ‘facilitate the adjustment.’ ” This gives the impression that Friedman wanted to disorient people through pain in order to push through his reforms. But the quote in its entirety shows that Friedman had something very different in mind. If a government chooses to attack inflation in this way, he wrote, “it should be announced publicly in great detail.…The more fully the public is informed, the more will its reactions facilitate the adjustment.” In other words, if voters are not ignorant and not disoriented, but fully informed of the reform steps, they will facilitate the adjustment by changing their saving, consuming, and bargaining behavior. Friedman’s view was the opposite of what Klein claims.

Not content to misrepresent Friedman’s opinions, Klein blames him for various crimes committed around the world. Most notably, she links him to Augusto Pinochet’s brutal military dictatorship in Chile in the 1970s, writing that Friedman acted as “adviser to the Chilean dictator.”

In fact, Friedman never worked as an adviser to, and never accepted a penny from, the Chilean regime. He even turned down two honorary degrees from Chilean universities that received government funding, because he did not want to be seen as endorsing a dictatorship he considered “terrible” and “despicable.” He did spend six days in Chile in March 1975 to give public lectures, at the invitation of a private foundation. When he was there he met with Pinochet for about 45 minutes and wrote him a letter afterward, arguing for a plan to end hyperinflation and liberalize the economy. He gave the same kind of advice to communist dictatorships as well, including the Soviet Union, China, and Yugoslavia.

Klein twists this relationship beyond recognition, claiming Pinochet’s 1973 coup was executed to allow free market economists (“the Chicago Boys,” as the economists from Friedman’s University of Chicago were called) to enact their reforms. This false link is crucial for giving the impression that the Friedmanites have blood on their hands, since the most violent period of the regime came right after the coup. But Friedman’s visit, which Klein claims started the real transformation, came two years later. Klein insists on having it both ways.

The reality was that Chile’s military officials were initially in charge of the economy. They were corporatist and paternalist, and they opposed the Chicago Boys’ ideas. The air force controlled social policy, for example, and it blocked market reforms until 1979. It wasn’t until this approach led to runaway inflation that Pinochet belatedly threw his weight behind liberalization and gave civilians ministerial positions. Their success in fighting inflation impressed Pinochet, so they were given a larger role.

Klein could have used the real chronology to attack Friedman for visiting a dictatorship that tortured its opponents — a commonly heard criticism of the economist — but that’s not enough for her. To find support for her central thesis that economic liberalism requires violence, she has to make it look like torture and violence were the direct outcome of Friedman’s ideas.

Klein also blames Friedmanite economics for the Iraq war, for the International Monetary Fund’s actions during the Asian economic crisis of the late 1990s, and for the Sri Lankan government’s confiscation of fishermen’s property to build luxury hotels after the deadly tsunami of 2005. In a 576‐​page book about such evils, why wasn’t there room to mention that Milton Friedman opposed the Iraq war, thought the IMF shouldn’t be involved in Asia, and believed governments should be prohibited from expropriating property to give it to private developers? Klein quotes from some interviews in which Friedman voiced these views, but she declines to mention Friedman’s long held positions that directly undermine her thesis.

Even though Klein is dead wrong about Friedman, she may well be right in her broader thesis that it’s easier to liberalize in times of crisis, and that there is a close connection between economic liberalization and political violence. It’s true that several dictators have liberalized their economies in recent years and that some of them have tortured their opponents.

But how strong is this connection? If we look at the Economic Freedom of the World statistics assembled by the Fraser Institute, a Canadian free market think tank, we find only four economies on the planet that haven’t liberalized at all since 1980, so obviously reform has taken place in all sorts of countries. But the statistics clearly show that most classical liberal reforms happen in democracies, not dictatorships. Klein never talks about such rapidly liberalizing democracies as Iceland, Ireland, Estonia, or Australia, where reforms were given renewed support in several elections. Presumably these countries just aren’t undemocratic and brutal enough. She does discuss Britain under Margaret Thatcher, but only to argue that Thatcher too relied on shocks and violence.

The Iron Lady won re‐​election in 1983, Klein says, because of the boost she got from the Falklands War. She doesn’t mention another reason for Thatcher’s growing popularity: The British economy was improving rapidly at the time. A 1987 study in the British Journal of Political Science looked in detail at the timing of events and British voters’ perception of them, and made a strong case that the Tories gained only three percentage points from the war; the vast majority of the gain came from improved economic prospects. And the Falklands War certainly cannot explain why Tories won two more elections after that, nor why Tony Blair’s New Labour had to dress itself in Thatcherite clothes to be elected.

Naomi Klein usually exaggerates the economic liberalization that has been carried out by brutal dictators. She needs to demonstrate that Pinochet’s interest in market reforms was typical of authoritarian regimes — otherwise, her arch‐​villain Friedman might have been right when he said that the surprising thing in Chile was not that the market worked but that the generals allowed it to work. So Klein ropes in the Argentinean dictatorship of 1976–1983. Based on those two examples, she claims the southern part of Latin America is where “contemporary capitalism was born.” She even calls the countries “Chicago School juntas.”

There were indeed advisers from the University of Chicago in Argentina; since there is strong global demand for Chicago economists, they have visited many countries. But their influence in Argentina was barely noticeable. In the Fraser Institute index of economic freedom, which gives scores from 1 (the least free) to 10 (the most), Argentina moved from 3.25 in 1975 to 3.86 in 1985. Compare this with the countries Klein mentions as superior alternatives to the Chicago Boys’ brutal “neoliberal” models: Sweden went from 5.62 in 1975 to 6.63 in 1985; Malaysia, one of the “mixed, managed economies” Klein prefers, went from 6.43 to 7.13. In 1985, after Argentina allegedly applied Friedman’s ideas, the country’s economy was less market oriented than all the Eastern European communist economies tracked by Fraser, including Poland, Hungary, and Romania. But Argentina tortured people, so in Klein’s mind it must have been on the fast track to free markets.

By Klein’s account, China is another country that violently imposed Friedmanite reforms. To make this case, she rewrites the history of the Tiananmen Square massacre of 1989, claiming the protesters were primarily opposed to economic liberalization, instead of one‐​party dictatorship. According to Klein, the Communist Party, led by Deng Xiaoping, attacked them to save its free market program and advance yet more sweeping reforms while people were still in shock.

If the students were indeed protesting economic reform, they seldom expressed that grievance at the time. Instead, they demonstrated in favor of democracy, government transparency, and equality before the law, and against bureaucracy and violence. The protesters first gathered to mourn former Secretary General Hu Yaobang, one of China’s most important economic reformers. The protests soon grew to include everybody who wanted liberal democracy — both those who wanted more economic reform and those who wanted less. Klein equates the second element with the whole protest.

Chinese officials suppressed the demonstrations because they wanted to protect the party’s power, not because they wanted to liberalize the economy. The majority were economic conservatives who were skeptical of markets; some even refused to visit Chinese free trade zones on principle. And the economic reforms did not accelerate after the massacre, as Klein claims. For the first time since their inception, they stalled.

The most consistent free marketeer in the leadership, General Secretary Zhao Ziyang, was purged because he supported the protesters, and he spent the rest of his life under house arrest. (Friedman had met him in Beijing in 1988 and wrote him a letter of advice. For Klein, this is yet another meeting with a tyrant.) Zhao’s rivals — including Premier Li Peng, who was pushing for a violent crackdown on the protesters — then tried to roll the market reforms back and reintroduce economic controls. The conservatives blamed the unrest on the openness associated with economic liberalization, and Deng’s position in the party was weakened. Far from being the start of “shock therapy,” Tiananmen Square was almost the end of China’s economic liberalization. Klein writes that “Tiananmen paved the way for a radical transformation free from fear of rebellion,” but according to the Fraser statistics, China was actually less economically open in 1990 than it was in 1985.

Klein writes that Deng opened the Chinese economy “in the three years immediately following the bloodbath.” This is true only if “immediately” means “three years later.” Reform faltered so much in the years following the crackdown that Deng felt he needed to go outside normal channels and jump‐​start liberalization in the spring of 1992, even though he was 87 years old and had formally retired. His “southern tour” was a trip filled with speeches and networking aimed at saving the reform program. The tour was not initially reported in the national media, since they were controlled by Deng’s rivals. Deng even found himself forced to write articles supporting his agenda under a pen name to get access. But he was eventually successful in winning local support and building alliances with provincial governors who favored liberalization. Only then did President Jiang Zemin reluctantly support Deng’s reforms.

To show that radical economic liberalization can happen only in dictatorships, Klein compares China to democratic Poland in the late 1980s and early ‘90s: “In China, where the state used the gloves‐​off method of terror, torture and assassination, the result was, from a market perspective, an unqualified success. In Poland, where only the shock of economic crisis and rapid change was harnessed — and there was no overt violence — the effects of the shock eventually wore off, and the results were far more ambiguous.” Once again, the statistics tell a different story. According to the Fraser data, Poland actually took reform farther and faster. In 1985 its economy was much less open, with a score of 3.93 versus China’s 5.11. In 1995, both scored 5.3. In 2005 Poland was way ahead, with 6.83 to China’s 5.9.

Klein also exaggerates the free market elements in anything she can associate with a crisis. She writes that politicians used Hurricane Katrina to introduce “a fundamentalist version of capitalism” in New Orleans. The “fundamentalist” reform in question? The introduction of more charter schools. Not satisfied to exaggerate just the nature of the change, Klein also stretches its extent: She writes that the school board used to run 123 public schools but after the hurricane ran only four, whereas the number of charter schools increased from seven to 31. She doesn’t mention that these figures date to the period immediately after the hurricane, when the school board was much slower to reopen its schools. As of September 2007, ordinary public schools again outnumbered charter schools, 47 to 44.

The strangest thing about Klein’s suggestion that crises benefit free markets and limited government is that there is such a long record of the exact opposite. World War I led to communism in Russia; economic depression gave us Nazi Germany. Wars and other disasters are rarely friends of freedom. On the contrary, politicians and government officials often use crises as an opportunity to increase their budgets and powers. As one prominent economist put it while explaining his opposition to war in Iraq: “War is a friend of the state.…In time of war, government will take powers and do things that it would not ordinarily do.” The economist? Milton Friedman.

Friedman was right about the Iraq war: The Bush administration has used that conflict and the larger War on Terror to dramatically expand the federal government’s powers and expenditures. Bizarrely, Klein points to the U.S. after 9/11 as a major illustration of her thesis. She claims the terrorist attacks gave the Bush administration an opportunity to implement Friedman’s ideas by benefiting friends in the defense and security industries with new contracts and unprecedented sums of money. Klein never clearly explains how this could possibly be Friedmanite. In the real world, Friedman “had always emphasized waste in defense spending and the danger to political freedom posed by militarism,” in the words of his biographer Lanny Ebenstein. Somehow, Klein has confused Friedman’s limited‐​government liberalism with corporatism.

As Klein sees it, in Bush’s America “you have corporatism: big business and big government combining their formidable power to regulate and control the citizenry.” This sounds like a healthy libertarian critique of the administration — something Friedman himself might say. But Klein thinks that Bush‐​style corporatism is the “pinnacle of the counterrevolution launched by Friedman” and that the team that implemented it is “Friedmanite to the core.”

So even when the U.S. government breaks all the rules in Milton Friedman’s book, Klein blames Friedman. At one point she writes about the lack of openness in the Iraqi economy: “All the…U.S. corporations that were in Iraq to take advantage of the reconstruction were part of a vast protectionist racket whereby the U.S. government had created their markets with war, barred their competitors from even entering the race, then paid them to do the work, while guaranteeing them a profit to boot — all at taxpayer expense.” This would be an excellent Friedmanite critique of how governments enrich their friends at the expense of competitors and taxpayers — if it weren’t for the conclusion to the paragraph: “The Chicago School crusade…had finally reached its zenith in this corporate New Deal.”

For Klein, tax‐​funded corporate welfare is the zenith of Chicago’s free market revolution. The idea seems to be that Milton Friedman likes corporations, so if governments give corporations contracts, subsidies, protection, and privileges, that must be Friedmanite. At times it seems like Klein thinks any policy is Friedmanite if private companies are involved. But you would have a hard time finding an economist more persistent than Friedman in warning how corporations and capitalists conspire against the public to obtain special privileges. As Friedman wrote in Reason in 1978: “Business corporations in general are not defenders of free enterprise. On the contrary, they are one of the chief sources of danger.… Every businessman is in favor of freedom for everybody else, but when it comes to himself that’s a different question. We have to have that tariff to protect us against competition from abroad. We have to have that special provision in the tax code. We have to have that subsidy.”

In the absence of serious arguments against free markets, we are left with Klein’s reasonable critiques of torture, dictatorships, corruption, and corporate welfare. In essence, her book says that Milton Friedman’s limited government ideals are bad because governments are incompetent, corrupt, and cruel. If there is a disaster here, it is not one of Friedman’s making.

Academia = Sheer Pettiness

Economics and Moral Courage

Lew Rockwell – October 08, 2020

It must be really painful to be an economist of the mainstream today, or, at least, it should smart to some extent. In a financial and economic calamity of the current scale, people naturally want to know who issued the warnings about the real estate bubble and its likely aftermath.

When private sector jobs have grown none at all in ten years, and when ten years of domestic investment is systematically undone in the course of 18 months, when housing prices in some sections of the country collapse 80%, and when formerly prestigious banks go belly-up or receive many billions in rescue aid, people want to know which economists saw this coming.

Perhaps it is these economists, the ones who had long issued the warnings, and not the ones relentlessly consulted by the media, who should be giving the guidance about going forward. Maybe it is they who ought to be weighing in on whether the new stock-market boom is a reflection of reality, or another bubble developing within a bust that could lead to a secondary depression.

Among the mainstream, however, no one saw it coming. That is because they have never learned the lesson that Bastiat sought to teach, namely that we need to look beneath the surface, to the unseen dimensions of human action, in order to see the full economic reality. It is not enough just to stand back and look at points on a chart going up and down, smiling when things go up and frowning when things go down. That is the nihilism of an economic statistician who employs no theory, no notion of cause and effect, no understanding of the dynamics of human history.

So long as things were going up, everyone thought the economic system was healthy. It was the same in the late twenties. In fact, it has been the same throughout human history. It is no different today. The stock market is going up, so surely that is a sign of economic health. But people ought to reflect on the fact that the highest-performing stock market in the world in 2007 belonged to Zimbabwe, which is home to a spectacular economic collapse.

It is because of the tendency to look at the surface rather than the underlying reality, that business cycle theory has been a source of such confusion throughout economic history. To understand the theory requires looking beyond the data and into the core of the structure of production and its overall health. It requires abstract thinking about the relationship between capital and interest rates, money and investment, real and fake saving, and the economic impact of the central bank and the illusions it weaves. You can’t get that information by watching numbers blow by at the bottom of your tv screen.

Then when the crisis hits, it comes as a complete surprise, and economists find themselves in the role of forging a plan to do something about the problem. This is when a crude form of Keynesianism comes into play. The government spends what money it has and prints what it doesn’t have. Unemployed people are paid. Tricks to prop up failing industries abound. Generally, the approach is to gin up the public to engage in some form of exchange to keep reality at bay.

Austrians counsel a different approach, one that takes account of underlying reality during the boom phase. They draw attention to the existence of the bubble before it pops, and once it goes away, the Austrians suggest that it does no good to blow another bubble or otherwise keep uneconomic production and plans going.

The Austrians in the late 1920s and early 1930s found themselves having to explain this again and again, but it was the onset of the age of positivism — the method that posits that only what you see on the surface really matters. So they had a very difficult time making points that were more sophisticated. They were like scientists trying to address a convention of witch doctors.

The same is true today. The Austrian account of the depression requires thinking on more than one level to arrive at the truth, whereas economists these days are more likely to be looking for obvious explanations and even more obvious solutions, even when these neither explain nor solve anything.

This puts the Austrians in an interesting position within the intellectual culture of any time and any place. They must go against the grain. They must say the things that others do not want to hear. They must be willing to be unpopular, socially and politically. I’m thinking here of people like Benjamin Anderson, Garet Garrett, Henry Hazlitt, and, on the Continent, L. Albert Hahn, F.A. Hayek, and, above all, Ludwig von Mises. They gave up career and fame to stick with the truth and say what had to be said.

Later in life, Hayek was speaking before a group of economics students. He bared his soul about this problem of the moral choices economists must make. He said that it is very dangerous for an economist to seek fame and fortune and to work closely with political establishments, simply because, in his experience, the most important trait of a good economist is the courage to say the unpopular thing. If you value your position and privileges more than truth, you will say what people want to hear rather than what needs to be said.

It is a feature that marked the life of Ludwig von Mises. Today, his name resonates around the world. The tributes to him pour out on monthly and weekly basis. His books remain massive sellers. He is the standard bearer for science in the service of human freedom. Especially after Guido Hülsmann’s biography of Mises appeared, the appreciation for his courage and nobility have grown.

But we must remember that it was not always so, and it did not have to be so. This kind of immortality is granted in no small measure because of the discrete moral choices he made in life. For if you had asked anyone about this man between 1925 and the late 1960s — the bulk of his career — the answer would have been that he was washed up, old school, too doctrinaire, intransigent, unwilling to engage the profession, attached to antique ideas, and his own worst enemy. They called him the “last knight of liberalism” as a way of conjuring up images of Don Quixote. When Yale University solicited opinions on whether it should publish Human Action, most people answered that this book should never see the light of day because its time was long past. It was thanks only to the intervention of Fritz Machlup and Henry Hazlitt that Yale bothered at all.

Mises was undaunted then as he had been throughout his life, and as he remained until his death. He had made a moral choice not to give in to the prevailing winds.

Before going into that choice more, I would like to speak of another economist who was a contemporary of Mises’s. His name was Hans Mayer. He was born in 1879, two years before Mises. He died in 1955.

While Mises worked at the Chamber of Commerce because he was denied a paid position at the University of Vienna, where Mayer served as one of three full professors, along with socialist Othmar Spann and Count Degenfeld-Schönburg.

Of Spann, Mises wrote that “he did not teach economics. Instead he preached National Socialism.” Of the Count, Mises wrote that he was “poorly versed in the problems of economics.”

It was Mayer who was the truly formidable one. Yet he was no original thinker. Mises wrote that his “lectures were miserable, and his seminar was not much better.” Mayer wrote only a handful of essays. But then, his main concern had nothing to do with theory and nothing to do with ideas. His focus was on academic power within the department and within the profession.

Now, people outside of academia may not understand what this means. But inside academia, people know all about it. There are people in every department who expend the bulk of their efforts on the pettiest form of professional advancement. What is at stake? Not that much. But as we know, the smaller the stakes, the more vicious the fight.

Among the prizes are better titles, higher salaries, the ability to get the best possible teaching times, to reduce one’s teaching load (ideally to zero) and office hours, to advance one’s favorite people, to get a larger office with a puffier chair, to know all the right people in the profession, and, best of all, to lord it over others: to be able to reduce the influence of your enemies and increase the influence of your friends in a way that can cause people to become your lifetime minions and supplicants.

With the state, there are even more prizes: to be close to politicians, to get outside gigs in which you serve as an expert in drafting legislation or in legal proceedings, to testify before congress, to get called by the MSM to comment on national affairs, and the like. The point is not to advance ideas, but rather to advance oneself in a professional sense.

Outsiders imagine that university life is all about ideas. But insiders know that the real battles that take place within departments have very little to do with ideas or principles. Strange coalitions can develop, based entirely on the pettiest of issues. Professional ambitions are the driving force, not principles. There are people in every department who are highly accomplished, but whose accomplishments have nothing to do with science, teaching truth, or pursuing a vocation as a real scholar.

This has been the case for many centuries in academia, but it may be worse now than ever. These pursuits are often well-rewarded in this life, while those who eschew them in favor of truth are pushed aside and relegated to a permanent low status. These are just some of the facts of life. This is what Hayek was referring to. And Mises’s life illustrates the point perfectly.

But let’s return to Professor Mayer. The main energies of Mayer were spent on an open war against his rival for power, Othmar Spann. This consumed him almost completely. He believed that he had to keep Spann at bay in order to advance himself. Mayer smeared Spann in every possible place and way, in a war to the knife. Note here that Mayer and Spann did not disagree on any matter of policy in any substantive way. It was all about position and power.

When he wasn’t consumed with passionate hatred for and plots against Spann, Mayer spent the remainder of his energy building up his power base within the University of Vienna. It began well for him as the acknowledged successor to Friedrich von Wieser, who was the previous power broker. Mayer had established himself as the most groveling student of Wieser’s. His reward was that Wieser named him as his successor, bypassing not only Mises but also the remarkable Joseph Schumpeter.

Then began Mayer’s march. He called the shots. Mises himself was on the enemies list, of course. He was in part responsible for denying Mises a full-time teaching position and salary. But that wasn’t enough for him. He treated Mises’s students very badly during examinations. For this reason, Mises even went to so far as to suggest that his seminar participants decline to be officially registered, if only to prevent them from being harmed by Mayer. Mayer also worked to make it nearly impossible for any student in the department to write a dissertation under Mises. The politics were vicious and relentless.

What was Mises’s attitude? He writes in his memoir: “I could not be bothered by all of these things.” He just kept on doing his work. One can easily imagine scenes from this period. Mises is in his office writing and reading, trying to hammer out and perfect the theory of the business cycle or reflect on the problem of economic methodology. A student would come in to let him know about Mayer’s latest antics. Mises would look up from his work, sigh with exasperation, and tell the student not to worry about it, and then go on with his work. He refused to be drawn in.

The Mises Circle was aghast by the goings on, but the members did their best to make light of it all. They even made up a song, set to a traditional Viennese melody, called the “Mises-Mayer Debate” that featured the two economists talking past each other and sharing no common values at all.

At one point, Mises’s circle grew into a full-blown economic society associated with the University. Mises could only be vice president, since Mayer would, of course, be president, since he was the master of the universe as far as economics in Vienna was concerned. And he never missed a chance to underscore who he was and what he could do.

Mises’s position as vice president would not last. The time came when Nazism grew in influence in Austria. As an old-time liberal and a Jew, Mises knew that his time was limited. Sensing the possibility of even physical harm, Mises accepted a new position in Geneva and left for his new home in 1934. The society declined in membership and otherwise floundered.

In 1938, Austria was annexed to the German Third Reich. Mayer had a choice about what he would do. He could have stood by principle. But why would he do that? It would have meant sacrificing his self-interest for the greater good, and that is something that Mayer had never done. Quite the opposite: his entire academic career was about Mayer and Mayer alone.

So, to his ever-lasting disgrace, he wrote all members of the Economic Society that that all non-Aryans were hereby expelled. This meant, of course, that no Jews were allowed to continue their membership. He cited “the changed circumstances in German Austria, and in view of the respective laws now also applicable to this state.”

So you can see, then, that all of Mayer’s power over his underlings was bested by the greater power of the state, to which he was unfailingly loyal. He thrived before the Nazis. He thrived during the Nazi takeover. He helped the Nazis purge the Jews and the liberals from his department. Note that Mayer was no raging anti-Semite himself. His decision was a result of a series of discrete choices for position and power in the profession against truth and principle. One day, it seemed harmless in some way, and then the moment of truth arrived in which he played a role in the mass slaughter of ideas and those who held them.

Perhaps Mayer thought he had made the right choice. After all, he maintained his privileges and perks. And after the war, when the Communists came and took over the department, he thrived then too. He did all that an academic was supposed to do to get ahead, and achieved all the glory that an academic can achieve, regardless of the circumstances.

But consider the irony of all this power and glory. In the bigger picture of Continental economics in general, the Austrians were not highly regarded by the profession at large. Since the turn of the century, the German Historical School had captured the mantle of science. Their empirical orientation and stance against classical theory had, over the decades, melded nicely with the rise of positivism in the social sciences.

Never forget that the phrase Austrian School was coined not by the Austrians but by the German Historical School, and the phrase was used as a put down, with overtones of a school mired in scholasticism and medieval deduction rather than real science. So our friend Mayer thought was he was master of the universe, when he was a very small fish in an even smaller pond.

He played the game and that was all he did. He thought he won, but history has rendered a different judgment.

He died in 1955. And then what happened? Justice finally arrived. He was instantly forgotten. Of all the students he had during his life, he had none after death. There were no Mayerians. Hayek reflected on the amazing development in one essay. He expected much to come out of the Wieser-Mayer school, but not much to come out of the Mises branch. He writes that the very opposite happened. Mayer’s machine seemed promising, but it broke down completely, while Mises had no machine at all, and he became the leader of a global colossus of ideas.

If we look at Mark Blaug’s book Who’s Who in Economics, a 1,300-page tome, there is an entry for Menger, Hayek, Böhm-Bawerk, and, of course, Ludwig von Mises. The entry calls Mises “the leading twentieth-century figure of the Austrian School” and credits him with contributions to methodology, price theory, business cycle theory, monetary theory, socialist theory, and interventionism. There is no mention of the price he paid in life, no mention of his courageous moral choices, no mention of the grim reality of a life moving from country to country to stay ahead of the state. He ended up being known only for his triumphs, about which not even Mises was ever made aware during his own life.

And guess what? There is no entry at all in this same book for Hans Mayer. It is not that his status is reduced, not that he is noted and dismissed, not that he is put down as a minor thinker with enormous power. He is not called a Nazi collaborator or a Communist collaborator. Not at all. He isn’t even mentioned. It is as if he never existed. Mayer’s legacy vanished so fast after his death that he was forgotten only a few years later.

It is so bad for Mayer today that Wikipedia doesn’t even have an entry for him. In fact, this talk has given more attention to him and his legacy than probably any other in 50 years. You might wait forever for another mention.

The Mayer line ended. But the Mises line was just beginning. He left for Geneva in 1934, accepting a dramatic pay cut. His fiancé followed and they were married, but not before he warned her that though he would write much about money, he would never have much of it.

And in Geneva he stayed for six years, having left his beloved Vienna and watched the world go through a shredding of civilization. The Nazis ransacked his old apartment in Vienna, and stole his books and papers. He was living a nomadic existence, unsure of where his next position would be. And this was the way he lived in the prime of his life. He was in his mid-50s and he was nearly homeless.

But as he dealt with the Mayer problem during those years in Vienna, Mises would not be distracted from his important work. For six years, he researched and wrote. The result was his magnum opus, a massive treatise on economics called Nationalokonomie. In 1940, he completed the book and it was published in a small print run. But how intense was the demand in 1940 for a book on the economics of freedom written in German? This was not destined to be a bestseller. He surely knew this while writing it. But he wrote it anyway.

Instead of book signings and celebrations, Mises faced another life-changing event that year. He received word from his Geneva sponsors that there was a problem. There were too many Jews taking refuge in Switzerland. He was told that he needed to find a new home. The United States was the new safe haven.

He began to write letters for positions in the United States, but think what this would mean. He was a German speaker. He had a reading knowledge of English, but he would need to learn it to the point that he could actually lecture in it. He had lost his notes and files and books. He didn’t have any money. And he didn’t know any powerful people in the United States.

There was a serious ideological problem in the United States too. The country was completely enthralled with Keynesian economics. The profession had turned. There were almost no free-market economists in the United States, and no academic to champion his cause. There were a few leads he had on jobs, but they were promises and there was no discussion of pay or any kind of security. He ended up having to leave with no assurances at all. He was almost 60.

But in the U.S. Mises did have a major champion outside of academia. His name was Henry Hazlitt. Let me review his history here too. He began his work as a financial journalist and book review editor for New York papers. He became so well-known as a literary figure that he was hired as the literary editor for The Nation before the New Deal. His free market views were not a special problem for him in those days. But after the Great Depression, liberal intellectuals had to make a choice: they had to adhere to free-market theory or embrace the industrial planning state of FDR.

The Nation went with the New Deal. This was a major reversal for this organ of liberal opinion that had long championed freedom and condemned industrial statism. The New Deal was nothing if not the imposition of a fascist system of economics, but The Nation set a precedent for the American left that this ideological tendency has followed ever since: all principles must eventually yield to the one over-riding imperative of opposing capitalism, no matter what.

Hazlitt refused to go along with the change. He argued with his colleagues. He pointed out the fallacies of the National Industrial Recovery Act. He patiently tried to explain to them the absurdities of the New Deal. He wouldn’t give in. They fired him. H.L. Mencken saw the greatness of his work and hired him as his own successor at American Mercury before turning over full control. Sadly, this didn’t work out either, because the ownership of that publication did not like Hazlitt’s Jewishness or free-market bent, and sent him packing yet again.

In different ways, in different sectors, and in different countries, it seemed like Mises and Hazlitt were living parallel lives. At each crossroad in life, they had both chosen the path of principle. They chose freedom even when it was at the expense of their own bank accounts and even though their choice brought professional decline and risked failure in the eyes of their colleagues.

Hazlitt moved to the New York Times, which back then did not have nearly the prestige it has today, however undeserved. He used his position to write about Mises’s books like Socialism. This grabbed the attention of a handful of American business people like Lawrence Fertig, who later became — like Hazlitt — a very generous donor to the Mises Institute. It was Fertig and his friends who knew of Mises’s arrival in America, and they were thrilled. They had seen what a devastating blow that FDR and Keynesianism were for free-market ideas. They put together a fund that would provide Mises a position at New York University, where he could teach and write. He was not paid by the university, where he was always a visiting professor, but through a private endowment.

Do you see how all of this links up? Hazlitt took the moral road, the courageous road, the road of sacrifice and principle. It was because of this that Mises, who had taken a similar road, could find safe haven in the United States. It was not the position that he deserved. He would be treated much worse than the Keynesians and Marxists. But it was something. It was an income to pay the bills. It was a chance to teach and write. He had the freedom to say what he wanted to say. That’s all he needed.

So we see how these two men of principle, worlds apart, ended up being drawn to each other because they recognized a type: men who are willing to do what is right regardless of the circumstances. Each could have gone another way. Mises might have been every bit as famous and powerful as Mayer had been, but he would have thrown away the immortality of his ideas in the process. Hazlitt could have been a high-status writer with a major outlet, but he would have had to surrender every ounce of integrity in order to do so.

Working together, they were able to overcome.

One of the people who had been drawn to Mises through Hazlitt’s writing was the head of Yale University Press, Eugene Davidson, who had approached Mises about doing an English-language edition of his magnum opus from 1940. Mises had already dedicated six years to that book and it had sunk without a trace. Now he was being asked to translate it into English. It was a daunting task, but he agreed in principle. Yale then set out to find referees to approve such a huge publishing risk. Yale first went to Mises’s old colleagues, and they were about as disappointing as referees as they were in other aspects of their careers. They wrote that there was no need to publish the book. Mises’s ideas were old and superseded by Keynesian theory. But Yale persisted. Hazlitt finally managed to assemble a group of people who would endorse the book’s translation, and Mises got to work again.

We all know the frustration that comes with losing a file on one’s computer and having to recreate it. Imagine what it was like for Mises to lose a 1000-page book, lose it to history in dark times, and being asked to recreate it in another language.

But he was undaunted. He got to work, and the result appeared fully nine years later. The book was called Human Action. By academic standards, it was a best seller and remains so sixty years later.

Even so, Mises remained at his unpaid, unofficial position. He gathered around him students for his seminar, even though other professors warned the students not to take the class or attend the sessions. They discouraged their students from having much to do with him at all. The dean seconded their hostility. For Mises, who had navigated the wars at the University of Vienna, this was small potatoes, nothing to pay attention to at all.

Slowly his fame spread, but we need to remember that even at its height then in the United States, it was tiny compared with what it is today. In fact, Mises died a year before what is usually considered the Austrian revival, which is often dated from 1974 when Hayek received the Nobel Prize, a prize that was entirely unexpected and which had to be shared with a socialist and which shocked a profession that had no interest in the ideas of either Mises or Hayek, whom they considered to be dinosaurs.

It is interesting to read Hayek’s acceptance speech, which the Mises Institute published this year. It is a tribute to a profession to which he wanted closer ties. But it was not a loving presentation of the glories of academia. In fact, it was the opposite. He said that the most dangerous person on earth is an arrogant intellectual who lacks the humility necessary to see that society needs no masters and cannot be planned from the top down. An intellectual lacking humility can become a tyrant, and an accomplice in the destruction of civilization itself.

It was an amazing speech for a Nobel Prize winner to give, an implicit condemnation of a century of intellectual and social trends, and a real tribute to Mises, who had stuck by his principles and never given into the academic trends of his time.

A similar story could be told about the life of Murray N. Rothbard, who might have become a major star in an Ivy League department but instead decided to follow the lead of Mises in economic science. He taught for many years at a tiny Brooklyn college instead, at very low pay. But as with Mises, this element of Rothbard’s life is largely forgotten. After their deaths, people have forgotten all the trials and difficulties these men faced in life. And what did these men earn for all their commitments? They earned for their ideas a certain kind of immortality.

What are those ideas? They said that freedom works and freedom is right, that government does not work and that it is the source of great evil in the world. They proved these propositions with thousands of applications. They wrote these truths in scholarly treatises and popular articles. And history has vindicated them again and again.

We are living now through another period of economic planning and we are seeing economists split on both sides. The overwhelming majority are saying what the regime wants them to say. To depart too much from the prevailing ideology of power is more of a risk than most want to take. A small minority, the same group that warned of the bubble, is again warning that the stimulus is a fake. And they are going against the grain in saying so.

I’m with Hayek on this point. To be an economist with integrity means having to say things that people don’t want to hear, and especially to say things that the regime does not want to hear. It takes more than technical knowledge to be a good economist. It takes moral courage, and that is in even shorter supply than economic logic.

Just as Mises needed Fertig and Hazlitt, economists with moral courage need supporters and institutions to back them up, and give them voice. We must all bear this burden. As Mises said, the only way to fight bad ideas is with good ones. And in the end, no one is safe if civilization is sweeping to destruction.

_________________________

This talk, sponsored by the Future of Freedom Foundation and the George Mason University Economics Club, was delivered at GMU on September 9, 2009.

From Gary North, here.

The Regime: Something Must Give Way Soon…

Thoughts on a “Right Wing Insurrection”

By 

January 9, 2021

January 6th was crack cocaine for the mainstream media, Democratic politicians, and some of their most ardent supporters.  As the high wears off, the post high paranoia will be a problem.

Mistrust of those around you, envisioning of enemies and evil doers behind every door, corner and mask, cowering under your congressional auditorium seats, well, we’ve all seen the pictures and the videos.

It’s scary out there!

Beyond the images of regular people sitting, boots on desk, in the Speaker of the House’s office, and beyond the lethal shooting of an unarmed protester by a Capitol policeman “defending” the already breached and swarmed capitol, there is a lot we can observe and learn about this relatively unusual event.

It wasn’t insurrection, despite endless repetitions to that effect by mainstream and left wing media.  Insurrection means, “an act or instance of rising in revolt, rebellion, or resistance against civil authority or an established government.”  What we saw was not a revolt – marchers intended to influence an upcoming actions and decisions by the Congress and the Vice President.  It was not a rebellion – marchers went to the accepted headquarters of the legislature to influence them, not to replace or destroy them, or steal their stuff.  With the possible exception of the unarmed physical breaching of the facility by a tiny portion of the far larger crowd of demonstrators, there was no resistance to any civil authority or any established government.

If this action had taken place with force of arms, after the Senate and House had accepted the disputed electoral votes submitted by the state legislatures, in an attempt to reverse the decision or take over government, we could call it an insurrection.  For those of us watching from the safety of our living rooms, the show of strength of so many Trump supporters, people who more importantly do not trust government, whether it be made up of Republicans or Democrats, was impressive.  One imagines that such energy and civil disobedience could be effective in coming years, and one day we could see actual popular insurrections occurring all over the country.  But that didn’t happen on January 6th.

There is another key point that mainstream media, and the Democratic thought guardians, have wholly missed, or misconstrued, and that is the idea that the Trump phenomenon going on five years now, is remotely right wing.  It is structurally anti-empire, and emotionally populist, a kind of greater Appalachian/Rustbelt/Cowboy populism.  It is given to common sense, a strange combination of old time religion and no religion at all, simultaneously cynical and yet holding vivid imaginings about the greatness and glory of the idea of America.  While the Q aspect (overwrought by the media) touched only a small portion of Trump populists, there is no doubt a widely shared desire among Trump supporters to “believe” in the government we have, and hope beyond all evidence that a person, or a party, can save the system.

That Trump kept many of his promises, and was relatively consistent in his energetic contempt for elites, at home and abroad, who “run” the world, was enough to keep the faith of the 74 million voters who wanted four more years.  But even these people, deep down, recognize that four, or eight years, would be little more than a stopgap.  Too much damage has been done, and the republic is today, as it was a decade ago, a dusty artifact

Unlike what any self-respecting “right wing” would be after, Trump populism (and his army of 74 million) sought to expand power to the people, and disrupt elitist, politicized, administrative tyranny of the state.  There is a reason Trump successfully expanded his base, year after year, with immigrants, Black and Hispanic voters, as well as young, old, men, and women of all religions, races, and occupations.  These actual trends belie any accusations by mainstream media talking heads – funded by big defense and big pharma – that his supporters, or the man himself, was “right wing.”

What can we learn from this particular misuse of language?  To skip to the punchline, it’s truly delightful!  We are learning that the deep state, with its real right and left wings, the status quo, the tax- and power-enriched bureaucratic government class, is beyond frightened of the cynical populist population it seeks to control, to rule, to surveil, and to eventually consume.  We are learning that they know that their quiver is empty, their knives are dull, and they are bereft of leadership, and without heroes. They are running out of words and phrases.

Half the country probably has some economic sense and yet they also cashed their Covid checks, and will continue to do so!  In fact, they may demand more of them – and my goodness, how could things have gotten this out of whack, and out of control?  The End the Fed movement, started by Ron Paul so long ago, and even once espoused by Trump himself, is being accelerated as the next administration seeks to pay back and solidify their “half” of the country, all of their elite supporters, and the Trump crowd too.  “Buying the vote” no longer works –  everyone is getting “free money” now, thanks to the those mating porcupines known as Trump and Anti-Trump.  We like it, we expect it, and Biden-Harris not only promised more, much more, they had absolutely no choice in the matter.  Imagine, Biden wakes up on January 20th (I know, right?) and decides all this money printing is going to be the death of the United States, and we need to bite the bullet. Instead, government central banks will collapse this country, and others, and in due course, themselves.  The instability of this situation will dog the next administration every day, and create impossible situations.  With half the voters so distrustful of Washington that they pulled a “January 6th” and another 30% of the population refusing to participate in the electoral scam at all, it won’t be pretty.  We are becoming hard to “govern,” and impossible to pay off.

The elite fear is palpable.  The tools the state uses, so far anyway, have been education, propaganda, and political division along lines they imagine they can control – generational, cultural, occupational, and political.  Yet the generations are more diverse than ever, with interesting and confusing alliances. American culture is largely consolidated, while we (whether we are three or 93) pick and choose what we will consume informationally, and every other way.  Occupational skill sets are converging and evolving, and no longer lend themselves to unions or the idea of “being spoken for.” Political parties are being held together by duct tape and slogans no one believes anymore.  The vast majority of people in this country hold their government in contempt, and have done so for an entire generation, if not two.

At this point, the governing elites need new tools.  They have a full range on electronic surveillance, sophisticated opinion-conforming and -tracking social media, vehicle GPS and cell phones to monitor, track and record our locations and movements, and of course, they might have the police and military. That darned second amendment, and all those hillbillies and cowboys in 2,000 counties across the land make it a tall order to use police and military force.  Fear (like of Covid) and any similar manipulated crisis that attempts to convert contempt for government into dependency – these are also excellent and proven tools, but it’s just not as easy as it used to be for the elites.  Maybe our modern elites just aren’t up to the task.  They are worried, and they should be.

Elite panic is all we are hearing and seeing on mainstream media. The logarithmic explosion of memes, articles, audio and video all questioning, challenging, ridiculing, and laughing at the government as a class is our new politics.  It’s shallow, it’s reactive, and it produces cynical angry men and women, not statesmen.  Thanks to the wonderful world we live in, that anger leads some of those cynical and angry people into the territory of new ideas, and builds a new awareness of both history and future possibilities.  For every misunderstood marxist, we also get one agorist, a constitutionalist, a future member of the Leave Me Be Party, and a couple of people whose profiles say “loves chickens, gardening and making my own bread.” There is very little room in the future for parasitic elites telling us to sit down, shut up and do what we are told.

From LRC, here.

They Don’t Need to Know Your Name…

On Sacrificing for an Idea

Gary North – October 08, 2020

Lew Rockwell gave a lecture on the trials and tribulations of three free market economists: Ludwig von Mises, Henry Hazlitt, and Murray Rothbard. He showed that their commitment to free market economic theory cost them their careers in an era of Keynesianism. Yet today, they are remembered by a growing number of readers. Their bureaucratic opponents are long forgotten: lost in the noise of “we, too.”

Rockwell did not mention this fact, but his efforts have been important in preserving this legacy. So are the skills of his digit-master, Jeffrey Tucker. The technology of the Web — the ultimate price competition in mankind’s history — favors ideas over institutional influence. The gatekeepers are now unable to restrict entry based on money and guild certification.

Ideas have more long-run clout that money does. Now the time frame grows ever-shorter. We have entered a new era: the triumph of digits. It is cheaper today to be a promoter of unpopular ideas than ever before. There are still career costs, but the barriers to entry for ideas are much lower. We should recall a fundamental insight of economic theory: At a lower cost, more is supplied. The gatekeepers today are on the defensive as never before. They are like elephants trying to stamp out ants. So many targets, so little time.

Mises, Hazlitt, and Rothbard were men of the pre-digital age, when access to book-publishing houses could make academic careers. Blocked ideas in their day had reduced consequences and longer time frames. Mises was blocked by his critics more successfully than Hazlitt was. Hazlitt had access to print media because he was a master of the written word. Rothbard labored in obscurity, but at least had some outlets, because of minor early funding by the William Volker Fund and later in the underground world of newsletters, the pre-digital realm of the dispossessed.

Rockwell did not have time to comment on the importance of all of the key gatekeepers who opened their gates. He did mention that Mises got Human Action into print at Yale University Press in 1949 because of the intervention of its editor, Eugene Davidson. Davidson was not afraid of controversy. A year earlier, he had succeeded in publishing Charles A. Beard’s masterpiece of historical revisionism, President Roosevelt and the Coming of the War. That book would have ended Beard’s career, had he not already been retired. The historical guild turned on him like a pack of jackals, for he showed that Roosevelt’s foreign policy had deliberately provoked the Japanese to attack the fleet. Beard was one of America’s most distinguished historians in 1947. By the end of 1948, he was a pariah.

Rothbard saw Man, Economy and State get into print in 1962 only because of the support of another anti-state economist, F. A. Harper. Harper had been with the Foundation for Economic Education, but his position on anarchism led to his dismissal by Leonard E. Read. Then he went to the Volker Fund. He ran it, but he did not control it. He was fired shortly before Man, Economy, and State appeared in print. Volker Fund money had funded it. He then founded the Institute for Humane Studies. In 1970, the IHS published Power and Market, the Volker Fund—the suppressed final section of Man, Economy, and State.

THE LABOR THEORY OF VALUE

Rockwell made an important point regarding Rothbard’s career in academia.

He taught for many years at a tiny Brooklyn college instead, at very low pay. But as with Mises, this element of Rothbard’s life is largely forgotten. After their deaths, people have forgotten all the trials and difficulties these men faced in life. And what did these men earn for all their commitments? They earned for their ideas a certain kind of immortality.

This forgetfulness is altogether fitting and proper. Austrian School economists strive their entire careers against the widespread public acceptance of an idea that is incorrect: the labor theory of value. This idea was basic to classical economics. It was rejected most forcefully by the founder of Austrian School economics, Carl Menger, in 1871.

The labor theory of value teaches that the value of final production rests on the price of the inputs. Menger showed that this explanation is the mirror image of the truth. The price of a factor input is based on competitive bidding by producers. Entrepreneurs bid up prices because of their expectation of greater revenues in the future. Value moves from contemporary expectations to factor prices, not from factor prices to final output.

If this is true, then the value of an idea is not based on its cost of production. The cost of production is a factor cost. It is a barrier to entry. To overcome this barrier, an entrepreneur of an unpopular idea must find a way to fund the production and distribution of the idea. As Rothbard taught, it is not possible conceptually to separate production from distribution. (Man, Economy, and State, 1962, 1993 reprint, pp. 554—56) The same principle of non-separation applies to ideas.

There are some people who select their ideas in terms of the existing market. Rockwell summarizes the career of one such economist, Hans Mayer. He is forgotten today. As a university bureaucrat, he compromised with the Austrian government and the hierarchy of the University of Vienna. Then Mayer compromised with the Nazis. Then he compromised with the Communists. He never lost his job, but his name is not associated with an idea or anything else. He is forgotten.

He cared about his job and his bureaucratic power. That was what he got. He cared nothing about ideas. He is forgotten. His actions cost him little, because he did not care for ideas or fame.

Mayer distributed ideas that the academic system wanted promoted. He produced none. He was well paid for his efforts. But ideas that are subsidized by the state and its apparatus in one era do not survive the demise of that state and apparatus.

In 1972, I heard a lecture by the conservative Austrian scholar and gadfly, Eric von Kuehnelt-Leddihn. He delivered it to a well-named little group, Ed Opitz’s “Remnant.” I remember only one point in that speech. It was a profound insight. He said that his father had been the loyal servant of four nations. First, he swore allegiance to the Austrian emperor. Then he swore allegiance to the post-war Austrian republic. Then he swore allegiance to the Nazi regime. Then he swore allegiance to the second post-war Austrian republic. There was no oath-bound continuity in his father’s life. There was only a series of broken oaths and defeated armies. There was no loyalty to any idea. The ideas changed. The governments changed. The oaths changed. Employment was the only constant.

He who is in the business of producing and distributing unpopular ideas can rejoice in such a world. The success or failure of ideas is not based on the labor theory of value. Idea-mongers may forecast incorrectly about future demand for their ideas, but the value of those ideas will not be determined by how hard they work. Someone else may work even harder. So what? The ideas will survive or perish, not in terms of whatever price a producer pays, but on whether consumers of ideas see a benefit in holding them.

So, a good marketer of ideas should begin with the old marketing principle: “Lead with the benefits. Follow with the proof.”

Today, distributors of Austrian School economic ideas should begin here: “Well, here’s another fine mess Keynesianism has gotten us into.” We should make it clear that “not Keynesianism” is a major benefit. This message has begun to get across. Demand is increasing. It will have an expanding market over the next decade.

Isn’t digital price competition grand?

CONCLUSION

Mises cared about ideas. His lack of stable employment was an annoyance to him, but career success was not high on his value scale. The same was true of Rothbard. Both men got what they paid for. They paid in a currency that did not matter much to them, especially Rothbard.

I think this is why heroes dismiss their own heroism. They paid for their acclaim in a currency that matters more to the general public than it matters to them. They faced a lower subjective barrier to entry than the public imagines.

If you believe in an idea, and the market is not responding as fast or as widely as you would prefer, donate some money. Or write something. Create a blog. Shoot a YouTube video. Ideas have consequences. Digits are cheap. Your time is short. The gatekeepers are in trouble. The elephants are stamping. The ants are winning. Climb on board. The feast has only just begun, one byte at a time.

However, don’t expect many thanks in the future. Your sacrifice today may be a good story for your posthumous print-on-demand paperback biography, but it is irrelevant for ideological success.

As Leonard E. Read used to say, “Here is how you will know when your idea has been a success. Someone will repeat it to you, and he will have no idea where it came from.”

From LRC, here.