29. How I Found Ludwig von Mises

29

BETTINA BIEN GREAVES

HOW I FOUND LUDWIG VON MISES

MY INTEREST IN MISES BEGAN after I answered a “Help Wanted” ad in The Washington Star. But a lot of history and living came before that.

I had majored in botany at college as a fluke. A boyfriend at MIT (Massachusetts Institute of Technology) had invited me to his senior prom and I was eager to go. It was the night before my final botany exam, so I studied especially hard and received my best mark of the year. So botany became my major. If I had thought the matter through carefully, I should have realized that I would never have been satisfied with a career as a botanist—I was more interested in people than plants.

I graduated from college during the depression when jobs were hard to come by, especially for botany majors. I soon started managing a small family-owned apartment complex that my architect father had created by remodeling and expanding his parents’ old Victorian home in the Washington, D.C. suburbs. But to gain marketable skills, I studied shorthand and typing and soon had two part-time stenographic and secretarial jobs. I also operated my own enterprise, Bets Photo Service, taking pictures of kids, developing and printing them in a homemade darkroom. And I started studying Spanish, hoping someday to visit South America. I wanted to see how people in other parts of the world lived.

Then came the attack on Pearl Harbor, December 7, 1941. Rent controls were passed; it became easier to find tenants but harder to pay the bills. I volunteered as an air raid warden and walked at night with neighbors on similar air raid warden duty. As the war continued, I decided I wanted work that was more exciting, more lucrative, or more supportive of the war effort. In December 1942, I consulted at an employment agency. An interviewer asked if I would like to work for the government. “No!” I replied. “For one thing I don’t like their long corridors.” The interviewer had in mind a job in South America and said I shouldn’t find long corridors there. In less than a month, I was en route to landlocked Bolivia high in the Andes. My prompt assignment was probably due primarily to my youth, my health and my stamina—it takes a strong constitution to survive at Bolivia’s high altitude—some Embassy personnel had left on hospital stretchers.

In 1943, it took three days to travel from Washington, D.C. to Bolivia—by train to Miami, by plane (my first ever flight) over Cuba, to Cali, Colombia, for a night, refueling in Guayaquil, Ecuador (hot!), another night in Lima, Peru, then up to the La Paz airport at 12,500 feet above sea level. I was to serve as secretary to a special U.S. commission investigating labor troubles in Bolivia, presumably instigated by Nazis, the terrorists of that day. The members of the commission returned home after six weeks and I was transferred to the Bureau of Economic Warfare with offices in the U.S. Embassy. BEW’s task was to purchase in Bolivia tin, tungsten and cinchona (tree bark used to produce anti-malarial medicine) for the war effort. My contribution to the war consisted of typing and filing letters and memoranda, each with multiple carbon copies.

I spent two fascinating years in Bolivia, an exotic nation of extremes, snow-capped mountains and tropical jungles, barefoot Indians lugging produce to market in packs on their backs and wealthy mining operators living in elegant homes. By rooming and eating meals with a Bolivian family, I learned something about how Bolivians lived and, along with their three-year old son, how to speak Spanish. I enjoyed life, drinking and dancing in the evenings and sightseeing on weekends. The altitude didn’t bother me, except when skiing at 17,500 feet or swimming in Bolivia’s 12,506-foot high Lake Titicaca. I had had my fill of books and studying in college and did no reading during my two years in Bolivia except for a few murder stories or mysteries.

On June 6, 1944, Allied forces landed on the beaches of Normandy and, although the war was by no means over, we began looking forward to its end. I decided I wanted to see first-hand how the Europeans lived and had survived the war. So I resolved to seek a transfer to Europe. I had forgotten almost all the German I had learned in two years at college so I started taking lessons from a German-Jewish refugee in Bolivia.

In the fall, I returned to Washington and asked to join BEW’s post-war mission to Austria, which was to be headed by a friend of my old boss in Bolivia—at that time I knew nothing about Austrian economics or Ludwig von Mises. While waiting for the transfer, I was assigned to BEW’s Mexican export-import licensing division, consisting of four men and two girls. I had so little work to do that I spent most of the office hours painting my fingernails and making scrapbooks for my one-year-old niece. However, I did type up the division’s budget request for the following year—for an appropriation sufficient to double the division’s staff to eight men and seven girls! I don’t know how their request fared, for I left Washington in March 1945 to join the Austrian mission. But I had had a lesson in Bureaucracy 101.

The Austrian mission was to assemble in Italy. The flight to Europe took many hours and many stops. Our plane had bucket seats along the sides and mail bags on the floor. I hadn’t slept at all the night before and was dead tired when we took off. I slept on the mailbags throughout the entire flight: to Newfoundland where we lunched; across the Atlantic to the Azores where we were fed again; and to Casablanca where I played chess with a GI while waiting for our next flight to Naples, our destination.

Our offices were in Caserta, a suburb of Naples, in an old medieval stone palace which had been taken over by the U.S. military. We took advantage of our time there to visit the traditional tourist sights in the Naples area: Salerno, Pompei, and the Isle of Capri. We were in Caserta when Roosevelt died on April 12, and young Italian newsboys, recognizing us as Americans, approached us on the street with their newspaper EXTRAs. It was in Caserta on April 29, 1945 that the German forces in Italy surrendered to the Allies.

After a few weeks, the office staff was flown en masse over Rome to Florence, where we spent another few weeks. We worked regular office hours, of course, but otherwise socialized, and strolled in the hills overlooking the city. While in Florence, we gave blood to help those wounded in the fighting still going on in northern Italy’s Po Valley. My memory is of a lovely city with many churches, interesting bridges over the Arno, and hillsides sprinkled with Italian villas and cypress trees.

Our next staging area was Verona, north of the Po Valley. A group of us jeeped from Verona to picturesque Venice and I remember dining and swimming in nearby Lake Como.

Shortly after V-E Day (May 8), we were relocated to Salzburg, in Austria. They sent me by plane—I was envious of those who crossed the Alps by jeep through the Brenner Pass. We eight BEW secretaries were the first American girls to reach Austria after V-E Day. American civilians in Salzburg, both men and women, were billeted in Hotel Pitter, which had been slightly damaged by bombs; some walls were a-kilter and some doors didn’t latch, leading to some unexpected and hilarious encounters. Salzburg was our last staging area before Vienna.

The treaty that ended World War II divided Germany and Austria into four zones, each to be under the control of one allied power: U.S., British, French, or Russian. Vienna, too, was divided into four sectors, each controlled by one of these four Allies. Salzburg was in the American zone but Vienna was in the middle of the Russian, so we had to travel through the Russian zone to reach Vienna. In August the staff set out in a caravan of several cars along the Russian-controlled highway to Vienna.

Vienna was a gloomy city that winter of 1945–1946. Many buildings had been bombed; prices were controlled; a black market flourished; the people were hungry; on weekends shabbily-dressed Viennese would go by streetcar to the end of the line and walk miles in the hope of buying a few cabbages or potatoes. We Americans often traded candy bars and cigarettes for family heirlooms, jewelry and curios. While most Viennese were starving, one young lady who sold us rings, pendants, chinaware and Meissen figurines, on behalf of her friends and acquaintances, actually gained weight from her candy bar commissions. Another Austrian woman we knew, a single mother, slept with GIs in exchange for perfumed PX cold cream in which she fried potatoes for her teen-aged son. I bought an oil painting of the Austrian Alps for ten cartons of cigarettes, which still hangs over my mantle—at that time one carton, i.e., ten packs, cost U.S. $1.00 tax-free at the Army PX. Every morning, as my girlfriend and I walked from our hotel to the office, she noticed we were followed by the same little old man; when she dropped her cigarette stub, he would stoop to pick it up. She soon took to turning around and handing it to him personally, for which he thanked her profusely. It was depressing how easily we privileged and fortunate Americans came to accept poverty and suffering all around us.

Our office in the U.S. sector of Vienna was in a former boys’ school that had been used as a hospital during the war. Life for us U.S. civilians was easy. In order to see how the Austrians lived, I had wanted to live and board with a family, as I had in Bolivia, but that was not permitted by the Army, for it would have been a burden on the local economy. As we civilians enjoyed officer status, we were fed and billeted with Army officers in a hotel, not far from the center of the city. Our contribution to the war effort as secretaries was, as usual, to take shorthand and type letters and memoranda with multiple carbon copies (no copy machines in those days).

We also occasionally attended a quadripartite (U.S.-British-Russian-French) meeting. Responsibility for planning refreshments and recording the minutes rotated month by month among the four powers. Each competed with the others in the lavishness of the meals and drinks served; alcohol always flowed freely. The Americans provided bourbon, the English scotch, the French wine, and the Russians vodka. Once, when the Russians were responsible for refreshments and for keeping the minutes, their translator phoned our office the next morning: “We remember what happened yesterday, but we would like to know what was agreed upon.” Apparently the vodka had flowed a little too freely.

BEW underwent several restructurings and name changes during the war and was finally disbanded in 1945 when the war ended in the Pacific. Those of us still in Vienna could go home or remain in Vienna working with the War Department. I signed a 6-month contract with the War Department in order to stay and see how the Austrians survived their first post-war winter.

After V-J Day, my mother wrote that there was talk of repealing U.S. wartime price controls. I had seen Austrians starving and having to pay black market prices for food just to survive and couldn’t imagine how they would manage if price controls were repealed. I thought that the repeal of price controls anywhere would only make matters worse. As a botany major in college, I had taken only a one-semester economics course intended for non-social science majors and was economically very naïve. Our textbook was written by Sumner Slichter. After completing that course, I concluded that the best social system would be rule by an “enlightened dictator” who had the interests of the citizens at heart. The only problem, I then thought, was that there could be no assurance that such an “enlightened” dictator would be succeeded by another equally “enlightened” one. I asked an Army Major in my office who had been an economics professor in civilian life about price controls. He explained that controls didn’t make any more food available; as a matter of fact, they created shortages. If things were in short supply and people really wanted them, they would have to pay extra to get them. If a farmer’s wife was sick, the farmer might even have to mortgage the farm to pay her medical expenses. The major’s explanation that individuals should be individually responsible for themselves and their family made sense to me.

There were, of course, many more American men than American girls in Vienna, so we had dates almost every evening. Our American boyfriends didn’t appreciate our talking in German with native Austrians, so I didn’t have much opportunity to use what I had learned in Bolivia. I was just becoming fluent enough in German to ask night club orchestra leaders to play special dance tunes when my six-month contract with the War Department was up, and I left for home.

Before leaving, I visited a trade fair in Vienna. Businesses that had survived the war and new ones that had sprung up since were showing the wares they were producing for export. This was before any massive financial U.S. aid had reached Austria. I was impressed by the vitality of her post-war enterprises. Many were using local raw materials to create original, newly designed and crafted artifacts. Some manufacturers were exhibiting complex, precision machine tools. Austrian industry seemed to be recovering nicely from the war.

I left Vienna in June 1946 with a girlfriend from the office. We traveled by train across Europe to France, stopping en route in Frankfurt, Darmstadt, which had been bombed to rubble, Amsterdam, Paris, and finally Le Havre, whence we sailed on a ship crowded with French war brides. Upon our arrival in New York, we went to the Brooklyn Navy Yard to sign papers separating us from the government. I was determined to leave government employment PERIOD, and asked to have all my retirement money refunded. I shook my girlfriend’s hand, and vowed never to work for the government again.

Back in the States, I worked for a time in the export division of a drug company in Philadelphia. When one of the men left the firm to open his own export-import business in Mexico, he asked me to manage the office. But his plans didn’t work out. So I went back home to Maryland and again began looking for a job.

As I said, I had had my fill of books in college. But I continued to study when I had a particular reason. I had learned shorthand and typing to help find a job during the Depression. I had taken private lessons in Spanish and German in anticipation of traveling to South America and Europe. But for several years, I had done no serious reading—only an occasional mystery, detective story, or novel, no non-fiction, and few if any newspapers. I decided I didn’t like myself. I felt the need for mental stimulation and set out to become more intellectual. I joined the Book of the Month Club and started reading books. I joined the Foreign Policy Association and read their publications. When the opportunity to go to Mexico and use my Spanish fell through, I answered an ad in the Washington Star for an editorial assistant. That sounded more challenging than ordinary secretarial work. In replying to the ad, I described my schooling and work experience in and out of government and closed by saying that “I was fed up with government bureaucracy.” I was called in for an interview.

The ad had been placed in the paper by Percy L. Greaves, Jr., then Executive Director of the newly organized, tax-exempt Foundation for Freedom. As I recall the interview, it was lively and stimulating. After talking for a while, he said he was still interviewing and would get back to me. He did. He offered me a job and I began work the following week in the Foundation for Freedom’s under-funded, sparsely furnished, one-man, one-girl office. That was when my economic education began.

Percy set me to work organizing his files. He said I would begin to understand what he wanted as I looked through his newspaper clippings and read the papers he marked every day for me to clip. I began by making folders for the clippings and arranging them under large subject areas: government, business, international relations, etc. When I told him I would put “housing” under “business,” he said that was where it should be, but not where it then belonged. I soon learned that his interest in “housing” was not in the private business of building houses, but in public housing and how government interfered and regulated the business.

I knew nothing at all about money and banking. However, I had learned from my father that inflation was due to government’s printing paper money. Percy explained that, under Roosevelt’s New Deal, the U.S. government didn’t have to print paper money directly; it had been given the authority to create new money by printing government bonds (government promises-to-pay). In other words, the government didn’t operate a dollar printing press directly, but it operated a bond printing press. The government could print paper IOUs (bonds) that could be converted into dollars through the Federal Reserve. For instance, if the government printed a million-dollar bond and gave it to the Fed, the Fed would open a million-dollar checking account in the name of the government. Then the government could write checks on this account to buy guns, pay government employees, soldiers, postmasters, social security retirees, etc. When the recipients cashed their checks, the Fed give them newly printed Federal Reserve notes, up to the full million dollars of the government’s bond which had been held as “backing” for the deposit. I was shocked! That was pure inflation! Pure stealing!

Percy invited me to lunch and talked about Pearl Harbor non-stop. He was full of the subject, having just spent an entire year with the Joint Congressional Committee on the Investigation of the Pearl Harbor Attack, trying to discover how much advance notice of the attack, if any, Roosevelt and his administration had had. I was fascinated!

When Percy was working on an article, he encouraged me to ask questions if I didn’t understand. But I didn’t know enough to ask questions. Yet one day I did ask, “Why wouldn’t it be a good idea for the government to collect the money and distribute it to the people as needed?” Shades of the benevolent dictator idea! He answered with another question: “Who is better suited to distribute money than the person who has earned it, who had the guts, energy, ideas, initiative, industry, and brains to produce it?” From that moment on, I was “liberated” from the “enlightened dictator” idea and began to see the world through free-market eyes.

Percy liked to talk and to explain and he found me a good listener and an eager student. It was a new and exciting experience to be appreciated because I had a mind, not merely because I was a woman. I encouraged him to keep on talking and explaining, and I kept on listening and learning. He gave me some economics books to read, but I found them pretty rough going. He also gave me pamphlets published by the Foundation for Economic Education in Irvington. These I could understand.

Percy had first heard of Ludwig von Mises in 1944 when he encountered Bureaucracy and Omnipotent Government in a bookstore. He was then Research Director of the Republican National Committee doing his best to keep Roosevelt from being elected to a fourth term as President. In 1944, while he was trying to explain to voters the threat inherent in Roosevelt’s interventionist New Deal programs, I was in Vienna doing no serious reading, socializing with Army officers in Vienna, and using my knowledge of German only to ask orchestra leaders to play my favorite dance tunes.

Percy had been so much impressed by Mises’s two 1944 books that when Human Action came out in the fall of 1949 he promptly bought a copy and started reading it. By then, the Foundation for Freedom had run out of funds and closed its doors, and he was free-lancing as writer and lecturer. During these years, whenever he traveled, he carried with him Mises’s 889-page Human Action PLUS his large 3,194-page unabridged Webster’s dictionary in order to look up the words in Human Action that he didn’t know. This experience planted the seed for Percy’s slender (157-page) Mises Made Easier: A Glossary for Ludwig von Mises’s HUMAN ACTION, published in 1974.

In 1950, Percy started writing a regular column for Christian Economics, a newspaper for Protestant ministers published by the Christian Freedom Foundation, and was spending most of his time in New York. When he heard about Mises’s Thursday evening seminar, he registered at New York University and began attending regularly.

I was living with my parents, in the D.C. suburbs, and working in a real estate office. I wasn’t yet up to reading Mises, but I had become interested in free market economics and began looking for a job in some related field. I wrote several free-market-oriented organizations, including the Foundation for Economic Education (FEE) in Irvington, N.Y., asking if they had any openings. Percy wrote a letter of recommendation on my behalf to FEE, saying I had a good understanding of the free market economy. I was asked to come to Irvington for an interview, was offered a job and started work at FEE in March 1951.

Mises was an adviser to FEE and a part-time staff member, so it was there that I first met him personally. In June/July 1951, I attended a two-week Mises seminar sponsored by The Freeman magazine, then a free-market oriented biweekly magazine produced in New York City and edited by John Chamberlain and Henry Hazlitt. At Percy’s suggestion, I took Mises’s lectures down in shorthand, transcribed them, had them multilithed and copies sent to the seminar participants. Mises’s comment: “Next time, young lady, write your own book.”

I began attending Mises’s NYU Thursday evening seminar in the fall of 1951 and took shorthand notes at each session. I started reading Human Action in bits and snatches every evening—it took me two years to finish. By then, and after having listened to Mises for two years, I was a committed Misesian. For Percy, Mises’s word was “gospel,” and he kept me focused. Whenever I asked a question, he would answer, “What does Mises say about that?” or “Look it up in Mises.”

I persuaded Leonard Read’s secretary, Mary Homan, to go with me down to the city to Mises’s seminar and we used to drive together every Thursday evening. Mary met Hans Sennholz at the Mises seminar and they got married in 1955. Percy and I got married eventually too, but he had a wife and family, so it took some time to work things out.

So, how did I come to Mises? It was by a long and circuitous route that wound throughout my life for many years. But in the end it all came together: my interest in people, my curiosity about how they lived and my late-developing desire for intellectual stimulation, to learn, to study and to understand. There had been clues along the way leading to an explanation of how people lived: the insight into the nature of government bureaucracy, the consequences of government price controls, and the importance of individual responsibility. But in the end Mises provided the answer. The way people live, and have lived throughout the ages, whether in caves, huts in the wilderness, suburban homes, city apartments, or skyscrapers, always depends on how they use and adapt all the things they have to get as much as possible of what they want. People’s wants and goals differ; their circumstances change, and the resources available vary. From time to time, they have new ideas, learn more about the world, discover better ways to work and cooperate with others. But throughout the ages and throughout the world, the way people live depends on how they use what they have to get what they want. And they live better, more comfortable, and more happy lives when they are free to pursue their various wants and to cooperate with others in peace, confident that they will be protected from violent and coercive interference by beasts or brutes. In other words, people will cooperate peacefully with others and live better when they are free to act as they think best, confident that their lives and property will be protected.

Bettina Bien Greaves compiled a two-volume annotated bibliography of books and articles by and about Mises (1993 & 1995) and was on the staff of the Foundation for Economic Education from 1951–1999. She was a student of Ludwig von Mises and attended his NYU Graduate Seminar in Economic Theory for 18 years, from 1951 until Mises’s retirement in 1969.