Why Americans Clamor for Socialism

If every time the government intervenes (known as economic interventionism) into the broader economy there is an eventual wave of resulting economic pain, and if the political and academic classes continue to describe our system as free market or capitalistic, then the entirely predictable result is a mass embrace of socialism as the solution to said economic pain.

The adoration of socialism by the younger generation is not merely a result of their natural ignorance on these matters; though because they are products of a highly bureaucratized and pro-government system, this is obviously the case. Rather, the espousal is a result of what they have been taught via schools, news, entertainment, political speeches, and other sources of intellectual influence. They have been taught both that we live in a free market, and that government is always the remedy.

Because the narrative is that we live in a free market, the benefit to the political class is twofold. 1) people can blame capitalism instead of government for economic pains; 2) Solutions must always come in the form of new government activity, since that has yet to be tried.

Thus, the masses currently clamor for the utopias of socialism to free them from the evils of capitalism, all while living under the rotten system of interventionism.


Hans-Hermann Hoppe on the Long-Term Capital Effects of Taxation

From The Economics and Ethics of Private Property

Taxation is a coercive, non-contractual transfer of definite physical assets (nowadays mostly, but not exclusively, money), and the value embodied in them, from a person or group of persons who first held these assets and who could have derived an income from further holding them, to another, who now possesses them and now derives an income from so doing. How did these assets come into the hands of their original owners? Ruling out that this was the outcome of another previous act of taxation, and noting that only those assets can be taxed that have not yet been consumed or whose value has not yet been exhausted through acts of consumption (a tax-gatherer does not take away another man’s garbage but rather his still valuable assets!), three and only three possibilities exist: They come into one’s possession either by one’s having perceived certain nature-given goods as scarce and having actively brought them into one’s possession before anyone else had seen and done so; by having produced them by means of one’s labor out of such previously appropriated goods; or through voluntary, contractual acquisition from a previous appropriator or producer. Only through these types of activities is one capable of acquiring and increasing valuable—and hence taxable—assets. Acts of original appropriation turn something which no one had previously perceived as a possible source of income into an income-providing asset; acts of production are by their very nature aimed at the transformation of a less valuable asset into a more valuable one; and every contractual exchange concerns the change and redirection of specific assets from the hands of those who value their possession less to those who value them more.


From this it follows that any form of taxation implies a reduction of income a person can expect to receive from original appropriation, from production, or from contracting. Since these activities require the employment of scarce means—at least time and the use of one’s body—which could be used for consumption and/or leisure, the opportunity cost of performing them is raised. The marginal utility of appropriating, producing, and contracting is decreased, and the marginal utility of consumption and leisure increased. Accordingly, there will be a tendency to shift out of the former roles and into the latter ones.


Thus, by coercively transferring valuable, not yet consumed assets from their producers (in the wider sense of the term including appropriators and contractors) to people who have not produced them, taxation reduces producers’ present income and their presently possible level of consumption. Moreover, it reduces the present incentive for future production of valuable assets and thereby also lowers future income and the future level of available consumption. Taxation is not just a punishment of consumption without any effect on productive efforts; it is also an assault on production as the only means of providing for and possibly increasing future income and consumption expenditure. By lowering the present value associated with future-directed, value-productive efforts, taxation raises the effective rate of time preference, i.e., the rate of originary interest and, accordingly, leads to a shortening of the period of production and provision and so exerts an inexorable influence of pushing mankind into the direction of an existence of living from hand to mouth. Just increase taxation enough, and you will have mankind reduced to the level of barbaric animal beasts.

This gets to the heart of what I had mentioned in my article on consumption charity. When you spend money on longer term capital projects, you increase future wealth for future people who otherwise would have been poor.


Pride Month and Woke Capitalism

Social media, the Internet in general, is almost unbearable during the so called “Pride month,” where the western world parades its predilection toward the sexually absurd in a modern exercise of the old French revolutionary spirit: épater le bourgeois. The Revolution which now dominates the social mood does not tolerate anything from dissent to disinterest— all must participate, all must pay tribute, all must turn attention in reverence to those selected as recipients of adoration and celebration.

Even the corporate branding and marketing teams understand the social consequences of giving the appearance of neutrality as the mania sweeps through the land. Conformity and subordination characterize the general response to the mob’s expectations.

To operate otherwise, even to carry on without partaking in the madness, is to adorn the label of Hateful One— a terrible and vicious social sin in the age of Love.


Mises on the Anti-Capitalist Bias

From Planned Chaos, which itself is an excerpt of Mises’s Socialism treatise.

Nothing is more unpopular today than the free market economy, i.e., capitalism. Everything that is considered unsatisfactory in present-day conditions is charged to capitalism.


The atheists make capitalism responsible for the survival of Christianity. But the papal encyclicals blame capitalism for the spread of irreligion and the sins of our contemporaries, and the Protestant churches and sects are no less vigorous in their indictment of capitalist greed. Friends of peace consider our wars as an offshoot of capitalist imperialism. But the adamant nationalist warmongers of Germany and Italy indicted capitalism for its “bourgeois” pacifism, contrary to human nature and to the inescapable laws of history. Sermonizers accuse capitalism of disrupting the family and fostering licentiousness. But the “progressives” blame capitalism for the preservation of allegedly outdated rules of sexual restraint.


Almost all men agree that poverty is an outcome of capitalism. On the other hand many deplore the fact that capitalism, in catering lavishly to the wishes of people intent upon getting more amenities and a better living, promotes a crass materialism. These contradictory accusations of capitalism cancel one another. But the fact remains that there are few people left who would not condemn capitalism altogether.


The characteristic mark of this age of dictators, wars and revolutions is its anti-capitalistic bias. Most governments and political parties are eager to restrict the sphere of private initiative and free enterprise. It is an almost unchallenged dogma that capitalism is done for and that the coming of all-round regimentation of economic activities is both inescapable and highly desirable.


None the less capitalism is still very vigorous in the Western Hemisphere. Capitalist production has made very remarkable progress even in these last years. Methods of production were greatly improved. Consumers have been supplied with better and cheaper goods and with many new articles unheard of a short time ago. Many countries have expanded the size and improved the quality of their manufacturing. In spite of the anti-capitalistic policies of all governments and of almost all political parties, the capitalist mode of production is in many countries still fulfilling its social function in supplying the consumers with more, better and cheaper goods.


It is certainly not a merit of governments, politicians and labour union officers that the standard of living is improving in the countries committed to the principle of private ownership of the means of production. Not offices and bureaucrats, but big business deserves credit for the fact that most of the families in the United States own a motor car and a radio set. The increase in per capita consumption in America as compared with conditions a quarter of a century ago is not an achievement of laws and executive orders. It is an accomplishment of business men who enlarged the size of their factories or built new ones.


One must stress this point because our contemporaries are inclined to ignore it. Entangled in the superstitions of statism and government omnipotence, they are exclusively preoccupied with governmental measures. They expect everything from authoritarian action and very little from the initiative of enterprising citizens. Yet, the only means to increase well-being is to increase the quantity of products. This is what business aims at.


The dogma that the State or the Government is the embodiment of all that is good and beneficial and that the individuals are wretched underlings, exclusively intent upon inflicting harm upon one another and badly in need of a guardian, is almost unchallenged. It is taboo to question it in the slightest way. He who proclaims the godliness of the State and the infallibility of its priests, the bureaucrats, is considered as an impartial student of the social sciences. All those raising objections are branded as biased and narrow-minded. The supporters of the new religion of statolatry are no less fanatical and intolerant than were the Mohammedan conquerors of Africa and Spain.


History will call our age the age of the dictators and tyrants. We have witnessed in the last years the fall of two of these inflated supermen. But the spirit which raised these knaves to autocratic power survives. It permeates textbooks and periodicals, it speaks through the mouths of teachers and politicians, it manifests itself in party programmes and in plays and novels. As long as this spirit prevails there cannot be any hope of durable peace,… of the preservation of freedom or of a steady improvement in the nation’s economic well-being.


The Meaning of “Dismal Science”

Just this week, I interviewed Gene Epstein for the summer issue of the Austro Libertarian Magazine. One of the questions I was preparing to ask him had to do with the description of economics as the “dismal science.” This phrase of course refers to the words of Thomas Carlyle. Gene explained to me that most people think that by this phrase it is meant that economics is bland or boring. But this is not what Carlyle meant– he was actually seeking to praise economics. Gene writes to me:

Why is economics called “the dismal science”? Ask the victims of Econ 101 — who are routinely confronted with indifference curves, money multipliers, and equations of exchange (bogus concepts, all) — and they’ll probably tell you: because it’s the boring science!

Ask the textbook writers, environmentalists, and general cognoscenti, and they’ll almost surely tell you: because it’s the unhappy science.

According to almost any standard source, 19th century author Thomas Carlyle used the phrase to describe the pessimistic theories of Thomas Malthus and David Ricardo, since they predicted decline and fall.

Not true, as economists David M. Levy and Sandra J. Peart show in their essay, “The Secret History of the Dismal Science.”

Thomas Carlyle did originate the phrase, and he did direct it at economists. But the “scientists” he had in mind were not Ricardo and Malthus, but economists like John Stuart Mill and Harriet Martineau. And their “dismal” offence was to advocate the abolition of slavery.

In a fierce and ongoing debate, the celebrated author of The French Revolution referred to “the Social Science [sic]…which finds the secret of this universe in ‘supply-and-demand,’ and reduces the duty of human governors to that of letting men alone.”

The above is from Carlyle’s 1849 essay, “An Occasional discourse [sic] on the Negro Question,” in which he goes on to use the D-S phrase for the first time. Compared to the “gay science” — meaning poetry — he calls economics the “quite abject and distressing…dismal science...led by [the] sacred cause of Black Emancipation [itals and caps in original].”

My impression is that Carlyle meant economics was too reductive to recognize the poetry of racial superiority — and was therefore dismal.

An essay he published the following year, in which he defended his proposal to re-enslave Jamaicans [!], included the stirring sentence, “Respectable Professors of the Dismal Science, soft you a little!”

No examples can be found of his using the phrase in any other way.

So how did this myth about the coining of the D-S phrase get started? The whitewashing, not to coin a pun, of Carlyle’s image must have had something to do with it. Some of the racist statements in the abovementioned essays are truly vile. But, otherwise, no one seems to know how the transmutation took place.

The originator of the D-S phrase was making grudging reference to a science that liberates. I myself will continue to use the phrase with that meaning in mind.


Dissent in a Socialist Society

In the Spring edition of AL Magazine, Mitch Thompson calls upon Austro-libertarians to pursue a more systematic and decisive mode of social and political dissent. His article, “In Pursuit of a More Radical and Consistent Dissent,” emphasizes the barriers that limit, and even preclude, opposition in society today. Thompson’s call for a more effective mode of dissent recalls a thought experiment put forward by Milton Friedman in his 1961 article “Capitalism and Freedom” in the New Individualist Review. In that article, Friedman asks how a socialist society would preserve the individual’s freedom to advocate capitalism – or, to frame the question another way, how a socialist society would protect the right to oppose socialism itself. In light of growing calls for socialism in today’s public discourse, Friedman’s question is both relevant and worth recalling.

Friedman asserts in his article that economic freedom is a necessary – though not a sufficient – condition for political freedom. (That economic freedom is not a sufficient condition is illustrated by the likes of Fascist Spain, Fascist Italy, and Czarist Russia (prior to World War I), which were largely characterized by private economic enterprise but were not politically free.) Friedman posits that, through voluntary market exchange and productive enterprise, economic power is more easily dispersed among people than political power. Further, such widely dispersed economic power can check the political power that tends to concentrate in the hands of a few. As such, free markets help to preserve political freedom.

To illustrate this point, Friedman begins by assuming (non-controversially, we may hope) that a primary element of political freedom is the freedom to advocate for alternative social, economic, and political arrangements – in other words, the freedom to dissent. Indeed, a hallmark of our free, capitalist society is the freedom to persuade others to voluntarily support programs that they may disagree with, even socialist programs. This is a freedom that Bernie Sanders and other Democratic presidential candidates, for example, are happy to make use of today. Could the socialist society likewise protect the freedom of an individual dissenter (let alone a candidate for high office) to promote a capitalist reorganization of society? Free markets and voluntary exchange among consenting individuals? For purposes of our thought experiment, Friedman asks us to assume that the public and its leadership seriously desire to enable such freedom. How would such a society arrange its institutions to make this freedom possible?

The first problem that Friedman identifies is the dissenter’s need to earn a living. In a true socialist state, the state is also the employer. The dissenter is therefore a government employee (or, if not employed, a beneficiary or dependent), and relies on the state for his livelihood. It is one thing for a private citizen to criticize his state, but quite another for the state employee to actively undermine or subvert his employer through calls for radical change. Friedman reminds us of those targeted by the House Un-American Activities Committees and the McCarthy investigations. The socialist state would therefore need to enact a self-denying ordinance that would not discharge state employees who advocate subversive doctrines like capitalism (which would advocate the end of socialism and thus the socialist state).

The next hurdle, Friedman notes, is the need for capital to finance dissenting speech, such as meetings, propaganda, publications, and other advocacy platforms. In a capitalist society, such resources are widely disbursed among small and large donors, and we can assume that a socialist society would not be very different in this regard. However, in a socialist society, Friedman posits that the wealthiest are likely to be those in positions of high government authority, a sound assumption given that the wealthiest zip codes in the US today routinely surround our nation’s capital. It is highly unlikely that the largest potential donors in a socialist state would finance (or even permit) dissent that undermines the status quo. The dissenter would thus need to rely upon smaller donors (read: minor civil servants) for such capital. However, in this day of IRS abuse, domestic surveillance, and retaliatory government, the small donor may be loath to risk her resources and livelihood to promote dissenting speech. Regardless, Friedman notes that there is a more fundamental question (and problem) to address, namely, how does the dissenter go about persuading potential donors and capital supporters to begin with?

Capitalism functions in accordance with supply and demand; if there is a high demand for compelling or even obscure ideas, then suppliers will provide such ideas at market prices. In a capitalist society, the dissenting idea doesn’t even need to be right in order for it to reach a wide audience – the dissenter just needs to convince a capitalist (any capitalist) that it will sell. Indeed, witness the recent proliferation of socialist advocacy products in the marketplace, which, ironically, denounce the same market functions that make their publication and distribution possible. In such a market, ideas may be freely traded. But how would such supply be possible in a socialist state? As noted above, it may be difficult in a socialist state to obtain voluntary capital contributions from large and small donors. If our hypothetical socialist public demands access to dissenting ideas, then perhaps the government establishes a public fund for subversive speech. But if subversive speech becomes profitable, then entrepreneurs will supply it and the government would need to ration such funds. Putting aside the unlikelihood of such a government agreeing to fund subversive enterprises (history belies such a dream), how would the state ration such funds? How would it determine what speech is profitable without a market? To whom would it direct such funds (I suspect our abovementioned “large donors” would be good candidates)? How would the government address rifts among the public over the resultant (publicly-funded) activities?

Friedman notes that, even if we solved this problem, how would the dissenter communicate her speech in the absence of private property rights? In addition to capital, the dissenter must be free to acquire paper or technology (on which to print or disclose her speech), distribution channels (through which to physically deliver her speech), real property rights (on which to hold meetings), and other rights that are attendant to communication today. In a free marketplace, she can freely arrange with private publishers, distributors, and others to disseminate her speech. Such third-party vendors do not care (or often even know) what she is publishing as long as she pays for the goods or services. By contrast, the dissenter in a socialist society must rely upon the state, directly or indirectly, to obtain the property rights necessary for communication. Indeed, if today’s standards are any guide, our beleaguered dissenter might need myriad licenses and other conditional clearances to even request or use such implements. And in each instance, she is likely to confront separate state agencies and personnel, any one of which may have reasons (or no reason at all) for rejecting her request. Lois Lerner and the Obama IRS suggest how such a regime may operate in practice.

These are among the most basic issues that a socialist state must address with respect to the genuine promotion of free speech and enterprise, and their resolution is hard to envision. Examples are difficult to find. Further, even if such issues could be resolved in practice, we must constantly keep in mind that governments, or at least those controlling the government, always change. A powerful government may attract those who presume to control it, but it will surely repulse them when the opposition succeeds to the throne. When the opposition succeeds (and it will), how much authority over speech and its related rights will you be comfortable placing in its hands?

There are many in the public square today protesting and advocating for social, economic, and political change. They are free to do so, in large part, because of the free market and the wide dispersal of power that it enables. Some of these dissenters advocate a socialist society. One wonders how they envision their society addressing the issues that Milton Friedman raised so many years ago.

Works Cited:

Milton Friedman, “Capitalism and Freedom,” New Individualist Review I, no. 1 (April 1961).


Our Helpless Forward Selves

I’ve been listening to Mark Spitznagel’s The Dao of Capital, which is three parts philosophy, two parts history, and one part investing advice, so if you’re into that sort of thing and don’t mind the same concept hammered home in a dozen different examples across multiple categories, you will love this book. In the chapter about the concept of “time preference,” he uses a striking turn of phrase when talking about the reality of our future selves and distant descendants.

The symptoms of this affliction [referring to our culture’s extreme focus on the now, at the expense of the future] can be found in the chronically low savings rate in our culture, ranging from financial to even fresh water, soil, and of course forests. And analagously and most incredibly, governmental fiscal deficits that deviously and increasingly rob future generations, our helpless intergenerational forward selves.

The first time I ran into this concept of a human being as a continuous being, simultaneously real across the span of his lifetime, was when reading about Kurt Vonnegut’s Tralfamadorians in Slaughterhouse-Five. They perceive time as existing all at once. In the book this produced a kind of passive, fatalistic philosophy. Since all that will be already is, there was no room for the idea of free will. I don’t take that view, but the image from the book, of viewing time and the people in it the way you might look at a stretch of the Rocky Mountains, their past and future selves just as real as the present one, stopped me in my tracks. It puts the present, which always dominates our perceptions and emotions, into a new perspective. It echoes something Einstein used to say about looking at past and future as equally and simultaneously real with the present.

This is in a section where Spitznagel credits Austrian economist Eugen von Böhm-Bawerk with noticing this truth and applying it to economics, and his choice of the word “helpless” really leaped out at me. It is a word that for me instantly conjures images of the downtrodden people who it is our moral duty to help. Suddenly the ideas of saving, investing wisely, delaying gratification, sacrificing in the now for something better later, becomes more than just a strategy for self-gratification for the far-sighted. It is a moral duty to a future self and to future others, people every bit as real as you are right now, but whose condition is completely at your mercy.

This idea is not so foreign to those who speak a language like Japanese or Chinese, where the verbs make no distinction between past, present and future. But for those of us raised on English, focusing more on the canoe than the river when thinking about time, this might be a jarring insight!

Anyone wishing to change the world through politics has a duty to understand economics. As arcane as some try to make it, economics is really just the study of naturally occurring tradeoffs. It is a pair of binoculars we can use to survey the landscape of Man’s struggle against the material world to grow and thrive. The better we can see, the better we can navigate in that realm. Those who don’t will often do what seems right, but actually leads to destruction. Böhm-Bawerk was right about the importance of time. Would-be reformers like some of the Democratic 2020 hopefuls would do well to pay attention to it. The systems we create today need to avoid creating crises later on. Human affairs are unpredictable, but not hopelessly so. Through economics we actually can spot errors, learn from them, and plan to avoid them.

We today are the children of generations that traded future obligations for present benefits: borrowing to make finance payments, instituting a monetary system that slowly bleeds the value out of cash savings in order to boost the present buying power of the state, the list goes on. We live in a time of incomprehensible abundance and yet the young feel as if they have to build their lives on very thin margins. Part of this, according to Robert Kiyosaki, is a failure to pass down financial wisdom, but there has also been a failure to respect the sanctity of our future selves and our distant descendants, all of whom are every bit as real as you are right now, even if they are not yet visible.

We cannot reach back to the past to ask for the guilty to restore what they took, but we can decide what to do with the world that we now have. According to Albert and Eugen, the future already exists. The people in it depend on us in the here and now to act in their interest.

No one else can.


Make Haste Slowly

Richard Weaver, from his autobiographical essay “Up From Liberalism,” on the proper attitude towards social change:

I am disinclined to the view that whatever exists necessarily has a commission to go on existing. On the contrary, I have a strong tendency to side with the bottom dog, or to champion the potential against the actual if the former seems to have some reason behind it; and I am mindful of the saying that God takes delight in bringing great things out of small ones. To this extent, I am a reformer or even a subverter. But I feel that situations almost never present themselves in terms so simple. They usually appear in terms like these: We have before us a tremendous creation which is largely inscrutable. Some of the intermediate relationships of cause and effect we can grasp and manipulate, though with these our audacity often outruns good sense and we discover that in trying to achieve one balance we have upset two others.


There are, accordingly, two propositions which are hard to deny: We live in a universe which was given to us, in the sense that we did not create it; and, we don’t understand very much of it. In the figure once used by a philosopher, we are inhabitants of a fruitful and well-ordered island surrounded by an ocean of ontological mystery. It does not behoove us to presume very far in this situation. It is not a matter of affirming that whatever is, is right; it is a recognition that whatever is there is there with considerable force (inertia even being a respectable form of force) and in a network of relationships which we have only partly deciphered. Therefore, make haste slowly.


There’s No Difference Between a Kind Capitalism and a Greedy Capitalism

I’m responding specifically to sentiments I’ve seen expressed in the conservative world as of recent. I’ve noticed there’s been a large injection lately of attempts to piously criticize a sort of “greedy” or “profit-oriented” capitalism. All of this is nonsense on stilts, built on the foundation of what Mises called the “Anti-capitalist mentality.” It is cautious toward pure and unfettered capitalism because it does not understand capitalism.

Capitalism is a social arrangement in which the means of production are privately owned; where the employment of said means is done according to the will of the consumers, as communicated via the price mechanism. Whether this employment of scarce capital is due to the capitalist being “kind” (and therefore doing as the consumer wants) or “greedy” (and therefore, in order greedily acquire a profit, doing as the consumer wants), it makes no difference. Perhaps we would want a man to be kind, and not greedy, but this has nothing to do with the existence of capitalism.

Man has an incalculable number of motivations for acting as he does, and no man, by praxeological definition, acts contrary to his own interests. In this sense, man is entirely self-interested. Indeed, this is ingrained with us. But self-interest expresses itself in a capitalist system by enabling man to gain what he desires only if he first contributes to the gain of his fellow man. This is what economists have referred to as a “coincidence of wants.” A kind man does not automatically provide for his fellow man better than the greedy man. In fact, often “kind men” offer to run governments, and therein undermine the progress of the market by intervening and preventing the market from doing as it otherwise would.

In any case, the benefits of Capitalism don’t care whether a man is greedy or kind. Or whether a man is lustful or compassionate. Capitalism is the arrangement wherein each man acts according to his own mental state and results in a growth in prosperity and a betterment of the masses. As Mises writes:

Capitalism is essentially a system of mass production for the satisfaction of the needs of the masses. It pours a horn of plenty upon the common man. It has raised the average standard of living to a height never dreamed of in earlier ages. It has made accessible to millions of people enjoyments which a few gen- erations ago were only within the reach of a small élite.

Economic interventionism against greed, regulation which aims to “protect” consumers,  regresses this glorious trend and not only puts back on the path to serfdom, but it also hampers the opportunity that the masses and the impoverished would have had to participate in the rising standards of living. It is a roadblock, a detriment, to the common man.


Keynes as Convenient Justifier of State Power

Mises makes a great point on the role John Keynes’ works played with respect to justifying state power. Rothbard (and Hoppe) later extrapolated on this theme, and I think it is important to remember. In sum, “academics” like Keynes merely offer to the politicians exactly what they wanted to hear: that the accumulation of increased state power and subsequent interventionism into the economy is, conveniently, good for society. Politicians love power and bureaucrats think they can design a social plan to bring forth utopia. Thus, the thoughts of Keynes gave them everything they wanted on a silver platter: justification for their actions.


There are people who believe that the two books of Keynes that became best sellers The Economic Consequences of the Peace (1920), and The General Theory of Employment, Interest and Money (1936) decisively influenced the course of British policies and of world affairs. It is said that the first of these books inaugurated the anti-French and pro-German tendencies of Great Britain’s “appeasement” policy which virtually encouraged the rise of Nazism, permitted Hitler to defy the essential clauses of the Treaty of Versailles and finally resulted in the outbreak of the Second World War. It is furthermore asserted that the second book generated the “Keynesian revolution” of economic policies. The abandonment of the gold standard and the adoption of outright inflationary or “expansionist” fiscal methods, the New Deal and the Fair Deal, the full-employment policy, the intensification of anti-importation measures and many other kindred ventures are ascribed to the “unorthodox” ideas propagated by Keynes. If these assertions are correct, Keynes appears as the most influential personality of our age, whether the effects of these policies are to be considered as beneficial or disastrous.

It is often simply thought that the governments of the west were unsure of what actions they wanted to employ, whether laissez faire or a state-controlled economy. And Keynes humbly came to the scene with scholarly and scientific solutions for the world.

In actuality, Mises explains:

Keynes was definitely not the inaugurator of a new economic policy. The governments did not have to wait for his advice in order to learn that inflation is a handy means to fill the empty vaults of the treasury. The Keynesian policies were practiced by governments and powerful political parties long before they were advocated by Keynes. Keynes’ writings were enthusiastically received by people who found in them an apparently scientific justification for what they had already done for a long time in defying the teachings of economics.


They hated the theory according to which there was but one means toward the general improvement of people’s material well-being, viz., to increase the per head quota of capital invested. They longed for short cuts to an earthly paradise; a protective tariff, a cheap money policy, the closed shop, doles, and social security. They did not want to be told by the economists that it is the policy of the unions that creates unemployment as a lasting mass phenomenon and that the periodical recurrence of crises is the inevitable outcome of the easy money policy. They knew better; all evils were caused by capitalism.


To such people the Keynesian slogans appealed strongly. Here they found what they were looking for. If demand lags, create “effective” demand by expanding credit! If there is unemployment, print more money! If you want to increase “the real national dividend of useful goods and service,” then “dig holes in the ground paid for out of savings!” And, first of all, do not save, spend!


The triumph of Lord Keynes’ last book, the General Theory, was instantaneous. Although reasonable economists refuted his doctrines, it has become the gospel of the self-styled Progressives all over the world. Today many universities simply teach Keynesianism. It is really paradoxical. Nobody can any longer fail to realize that what is needed most is more saving and capital accumulation and that the inflationary and expansionist policies are on the verge of complete breakdown. But the students are still taught the dangers of saving and the blessings of expansionism.


Understanding the New Socialism will go a long way in our effort to challenge it

One of the things that frustrates me greatly, and has been a small motivation for the creation of the publication, is the complete lack of understanding when it comes to the far left’s newfound socialism. For one thing, of course there are always the doltish and teenage AOC type socialists; they are great ground for making fun and all that.

But a lot of socialists are actually quite intellectually mature and informed. Misinformed, perhaps, but intellectually stimulating nonetheless. In fact, Marxism itself is unique in that it offers a complete intellectual and philosophical system as opposed to the inherent pragmatism of mainstream statism as it has actually appeared.

Think about our own Hans Hoppe. The thing that attracted him to Marxism before he was introduced to Austro-Libertarianism, was that it was a holistic system and it therefore started and depended on fundamentals– intellectual building blocks upon which the rest of the doctrines were constructed.

In any case, three examples of libertarian shortcomings with regard to understanding modern socialism should suffice.

First, unlike traditional socialism, modern self-labeled socialists do not really call for state ownership of the means of production. In my opinion, it is a great injustice that this occurred and Mises gets almost zero credit. I think he dismantled the very idea of single party ownership so decisively that now people use the word socialism but that can’t actually adhere to its original meaning. This is Mises’ vindicating achievement, but no one talks about it. Rather, as will be elaborated in the Summer 2019 issue of Austro Libertarian Mag (name change yet undecided), modern socialism is much more akin to socialism; where workers own the business firms of the society. There is “collective” ownership of the means in that sense and that sense alone.

This brings me to point two: socialists, in their original or modern form, have never been against personal property. They are against private property. By this distinction (a distinction libertarians, and therefore myself, refuse to make) they mean there is a difference between consumer goods being owned in whole by the individual (legitimate) and capital goods being owned by individuals (illegitimate); or at least, by individuals who did not mix their labor with said capital good (such as capitalists!)

Finally, socialism was not the struggle Americans faced in the twentieth century. We faced, and still face, interventionism; or the unhampered market. Private ownership of the means of production, together with severe government involvement, subsidy, protection, bailout, (government granted) monopolization, price controls, regulation, taxes, mandates, etc etc. This is why the socialist left just called it all capitalism. They misunderstood, of course, but we have to be fair and understand that most of it was what Mises wrote against in his Planning For Freedom essay: it was the alleged mixed economy. And as it begins to crumble, capitalist libertarians and socialists are both pining for the future.

In any case, on those three points, the crux of it all is this: libertarians need to realize A) socialism has its intellectually worthy adherents, B) just because the great enemy of the 20th century was Keynesianism doesn’t mean this will be true over the next decade; socialism (which must NEVER be confused with interventionism) is on the rise, and C) we need to stop misunderstanding and misrepresenting them. This gives them power and makes us look downright idiotic.


McClanahan on the Southern Agrarians

I was just able to watch Brion McClanahan’s portion of the AERC panel on “Remembering the Interwar Right.” A few thoughts of my own.

A ) I have a certain sympathy for the South as McClanahan presents it, even though I’m not myself a southerner. One difficulty I have is that McClanahan has a tendency to romanticize the South more than even someone like Weaver (see here). I think McClanahan is in the position of defending what in modern society is indefensible – namely, the South – but I think sometimes he oversimplifies the South. That’s not to say that I don’t appreciate his comments, it’s just an observation of some of his tendencies.

B ) I 100% agree that regionalism, be it southern, eastern, or midwestern, is badly needed in modern society. I think that each of the sections is losing its distinctiveness, and mass, nationalized society is preserving more or less the worst elements of each of these sections. The reason, for instance, that people can romanticize the South is because it had some definite virtues, but those virtues are being destroyed along with its vices. This is no less true of the other sections. As a midwesterner, I notice this as increasingly middle America attempts to be as cool as the coasts. It’s a real shame.

C ) I like his interpretation of Tucker Carlson’s comments, because I think that some of Carlson’s concerns are valid and I want a lot of the same things he wants. But, the problem is that if you can’t identify or articulate the problem correctly, your solution and proposals aren’t likely to be effective. I would level this same criticism at Dan McCarthy (as Donald Devine did here), although I think McCarthy has less of an excuse because he’s more widely read on conservatism than Carlson is.

D ) Here’s a link to some of Weaver’s comments on the South. What’s interesting to me is that Weaver has very strong sympathies for the South and the agrarians, but he also criticizes the South for not producing the philosophers needed to articulate their reason for being right, and also for attempting to use symbols that have outlived their usefulness.

Overall, I liked this talk. Agrarianism in one form or another plays a role in the philosophy of the best conservative writers (Weaver, Kirk, Nisbet, Scruton, etc.), but it’s not always southern. I think that Southern culture should remain, reassert itself, and improve itself by its own internal efforts, but I think that’s true of all the different cultures in the country. The worst thing that can happen is this bland, stultifying generic mass culture that reduces everything to either a transaction or virtue signal.

Update: I neglected to add this in my original comments, but McClanahan is spot on when he talks about the importance of “place.” Weaver said that “To be of a place, to reflect it in your speech and action and general bearing, to offer it as a kind of warranty that you will remain true of yourself – this is what it means to have character and personality. And without these things there is no individuality.”

People laugh at Russell Kirk for calling automobiles “mechanical Jacobins,” but increased mobility has really contributed to the decline of culture as people have become increasingly nomadic, simply picking up and moving for jobs or just for a change (which is different than moving to preserve freedom or culture). Of course, nobody can be totally against mobility, and becoming a Luddite is no solution, but we can acknowledge that there can be improper and disorganizing uses of technology.