A version of this article appeared in the May 2004 issue of The Free Market.

I am often asked about career paths for freedom lovers. How can one combine professional life with the advancement of liberty? Let’s admit at the outset that it is presumptuous to offer any answer since all jobs and careers in the market economy are subject to the forces of the division of labor. Because a person focuses on one task doesn’t mean that he or she isn’t great at many tasks; it means only that the highest productive gains for everyone come from dividing tasks up among many people of a wide range of talents.

So it is with the freedom movement. The more of us there are, the more we do well to specialize, and there is no way to know in advance what is right for any person in particular. But this much we can know. The usual answer—go into government—is wrongheaded. Too many good minds have been corrupted and lost by following this fateful course.

It often happens that an ideological movement will make great strides through education and organization and cultural influence, only to take the fateful step of believing that politics is the next rung on the ladder to success. This happened to the Christian Right in the 1980s. They got involved in politics in order to throw off the yoke of the state. Twenty years later, many of these people are working in the Department of Education or for the White House, and do the prep work to amend the Constitution or invade some foreign country. This is a disastrous waste of intellectual capital. Read more

You surely didn't think that the governing elites would let this economic crisis pass without pushing some cockamamie scheme for control. Well, here is the cloud no bigger than a man's hand, a revival of a 60-year-old idea of a global paper currency to fix what ails us.

The IMF study that calls for this is by Reza Moghadam of the Strategy, Policy, and Review Department, "in collaboration with the Finance, Legal, Monetary and Capital Markets, Research and Statistics Departments, and consultation with the Area Departments." In other words, this paper shouldn't be ignored.

It's a long-term plan, but the plan has the unmistakable stamp of Keynes: "A global currency, bancor, issued by a global central bank would be designed as a stable store of value that is not tied exclusively to the conditions of any particular economy.... The global central bank could serve as a lender of last resort, providing needed systemic liquidity in the event of adverse shocks and more automatically than at present."

The term bancor comes from Keynes directly. He proposed this idea following World War II, but it was rejected mostly for nationalistic reasons. Instead we got a monetary system based on the dollar, which was in turn tied to gold. In other words, we got a phony gold standard that was destined to collapse as gold reserve imbalances became unsustainable, as they did by the late 1960s. What replaced it is our global paper money system of floating exchange rates. Read more

This article was first published in Vol. 21, Number 5 of The Free Market.

Lecturing at the London School of Economics from 1931 to 1950, F.A. Hayek was nicely positioned to counter the rising influence of J.M. Keynes. Keynes's new vision of macroeconomics was a resurrection of old fallacies but with a modern twist: an open call for a consolidated state to manage investment. More than anyone else, and under the pretense of explaining the economic crisis of the time, Keynes gave intellectual credence to the rise of managerial states in America, the UK, and Europe during the '30s and the war. 

Hayek countered with a defense of laissez-faire beefed up by the insights of the Austrian School of economics. He had worked with Ludwig von Mises in Vienna after the period in which Mises first laid out his business cycle theory. The danger of central banks, wrote Mises, is that they exercise power of interest rates, and can thereby distort the production structure of an economy. They can create artificial booms, which either lead to hyperinflation or economic bust.  Read more

This article appears in the December 2005 issue of the Free Market.

Ludwig von Mises didn’t like references to the "miracle" of the marketplace or the "magic" of production or other terms that suggest that economic systems depend on some force that is beyond human comprehension. In his view, we are better off coming to a rational understanding of why markets are responsible for astounding levels of productivity that can support exponential increases in population and ever higher living standards.

There was no German miracle after World War II, he used to say; the glorious recovery was a result of economic logic working itself out through market forces. Once we understand the relationship between property rights, market prices, the time structure of production, and the division of labor, the mystery evaporates and we observe the science of human action making great things happen.

He is right that understanding economics does not require faith, but there are actions undertaken by market actors themselves that require faith (and Mises would not disagree with this)—immense faith, faith that moves mountains and raises up civilizations. If we accept the interesting description of faith by St. Paul ("evidence of things unseen") we can understand entrepreneurship and capitalist investment as acts of faith. Read more

Murray N. Rothbard (1926-1995) was just one man with a typewriter, but he inspired a world-wide renewal in the scholarship of liberty. During 45 years of research and writing, in 25 books and thousands of articles, he battled every destructive trend in this century -- socialism, statism, relativism, and scientism -- and awakened a passion for freedom in thousands of scholars, journalists, and activists. 

Teaching in New York, Las Vegas, Auburn, and at conferences around the world, Rothbard led the renaissance of the Austrian School of economics. He galvanized an academic and popular fight for liberty and property, against the omnipotent state and its court intellectuals. 

Volumes one and two of his magisterial history of economic thought appeared just after his death, published by Edward Elgar. Whereas other texts pretend to an uninterrupted march toward higher levels of truth, Rothbard illuminated a history of unknown geniuses and lost knowledge, of respected charlatans and honored fallacies. A large collection of Rothbard's best scholarly articles appears later this year in the publisher's "Economists of the Century" series. In addition, there are unpublished manuscripts, articles, and letters to fill many more volumes.  Read more

"A Primer on Mises"
by Llewellyn H. Rockwell, Jr.

When Ludwig Heinrich Edler von Mises died in New York City in 1973 at the age of 92, there was no front-page obituary in the New York Times. But believers in liberty knew that a giant had fallen. 

Mises was born in 1881 in the Austro-Hungarian city of Lemberg, the son of a successful engineer. At the age of 19, he entered the University of Vienna, and received his doctorate at 27.

In the intellectually stimulating atmosphere of the University of Vienna, the young Mises studied in the tradition of the founder of the Austrian School, Carl Menger. Mises also attended the seminar of the other giant of the School, Eugen von Böhm-Bawerk. Along with teaching, Böhm-Bawerk was finance minister of Austria-Hungary, and he put the School's ideas into practice by balancing the budget and establishing a gold standard. 

After receiving his PhD, Mises set to work on The Theory of Money and Credit (1912), his first major work. The earlier Austrians had followed the classical school in separating money from the rest of the economy, analyzing it in separate theoretical terms. Mises argued that just as the price of any commodity is determined by supply and demand, so is the purchasing power of money, its "price." Read more

This article was first published in Vol. 24, Number 2 of The Free Market.

Critics accuse libertarians of reveling in government failures. Yes and No. No one is pleased to see the destruction caused by government policies, whether small scale, as when a tighter regulation causes business failures, or large scale, as when wars destroy life for millions.

The kernel of truth to the claim is this: the failure of government illustrates something extremely important about the structure of reality that most people are likely to forget. It comes down to this: statesmen and public officials, no matter how powerful they may be, cannot finally control social outcomes.

If I might offer a summary of a point emphasized in all of Mises’s works: the structure of society and world affairs generally is shaped by human actions, stemming from imaginative human minds working out individual subjective valuations, and their interactions with the material world, which is governed by laws that are beyond human control. Read more

This speech was given before students, professors, trustees, and others at an awards dinner April 4, 2002.

Free-market economics, of which the Austrian School is the preeminent exponent, asserts that every government intervention in the market generates consequences that are deleterious for prosperity and human liberty. However much such interventions may assist one group in the short run, everyone is made worse off in the long run. Government intervention destabilizes economic life in artificial ways, and ultimately does not work to bring about the results that its exponents claim to desire. 

Rather than dwelling on the theoretical apparatus that demonstrates this, I would give some examples of how this works, based on recent issues you may have read about in the news, and draw some broad lessons from them. 

Let us begin with the economic recovery. The headlines of the business pages have been trumpeting its arrival now for months. How do the experts decide when recession has turned to recovery? By looking at the data, which come in packages labeled in various ways: the GDP, the leading indicators, the unemployment rate, industrial production, housing starts, commercial borrowings, office vacancy rates, and a host of others. If these tend in the negative direction, we are said to be entering a recession. If they move in a positive direction, it is said that we are recovering.  Read more

This article was first published in Vol. 19, Number 7 of The Free Market.

In 1957, a businessman and radio personality named Robert LeFevre (1911-1986) founded a very special institution in Colorado Springs, Colorado. In his private studies, he had discovered the libertarian intellectual tradition. He noted the dire need for an institution that would educate people from all walks of life in the philosophy of freedom. He took it upon himself and named it the Freedom School, later changing the name to Rampart College before it shut down in 1968. Afterward, he carried on his work in South Carolina under the patronage of business giant Roger Milliken.

The Freedom School in Colorado was one of the most important institutions for teaching free-market economics in its day. Among its rotating faculty were Rose Wilder Lane, Milton Friedman, F.A. Harper, Frank Chodorov, Leonard Read, Gordon Tullock, G. Warren Nutter, Bruno Leoni, James J. Martin, and even Ludwig von Mises. Among its graduates were Roy Childs, Fred and Charles Koch, Roger MacBride, and many other intellectual activists still working today.  Read more

This article was first published in Vol. 18, Number 5 of The Free Market.

It was a revolting display to see the bureaucrats at the Justice Department cheer Federal Judge Thomas Penfield Jackson's decision. Many of these people didn't even know how to get around the web twelve months ago, and now they are making decisions for millions of consumers and threatening to smash the company that democratized information. The government, driven by power-lust and fueled by the envy of Microsoft's competitors, is happy to jam a crowbar into the wheel of commerce.

Some old-time conservatives had a soft spot for antitrust laws. They believed in free enterprise, but made exceptions for interventions that curb the activities of corporations. In this, they are joined today by free-market economists of the Chicago School: critical of the way antitrust laws have been applied, but stopping short of demanding their repeal.

Yet it has never been clearer that antitrust is exactly what the economists of the Austrian School have always claimed: a political weapon that accomplishes no social good and imposes much social harm. Exhibit A is, of course, the absurd Microsoft case, in which the government is attacking a wonderful company on technical issues now years out of date.  Read more

This article was first published in Vol 17, Number 8 of The Free Market.

When Janet Yellen, Clinton's chair of the Council of Economic Advisors, resigned her post, she said it was for purely personal reasons. But according to inside reports, the personal reasons included frustration at having to lie day-in and day-out. No matter what the economic data of the week, she was expected to give it a spin that would boost the president and smear his enemies.

She was made to tout the glories of Clinton's proposed Social Security reform in front of Congressional committees. She warned of the dangers of global warming. She sang the praises of Clinton's commitment to child care and social services. She might as well have been reading campaign literature aloud, which tends to undermine one's scientific credibility.

No surprise here. To some degree, this is what the economists who held this post have always done. What's surprising is that any self-respecting economist would take the job in the first place. And to her credit, Yellen always looked vaguely uncomfortable spewing out politically-correct blather as her full-time job. And this was despite the fact that reporters went easy on her because she is a liberal woman working for an administration generally beloved by the media.  Read more