Commentary

0:00I have a problem in commenting on these papers that I didn't see any of the papers in advance. I didn't know what Joseph Salerno was going to say, but I didn't see any other papers. I thought I was going to have the same problem on another session that I was supposed to comment on a paper on social doctrine. I hadn't seen any papers for that, but fortunately for me that session was cancelled and it's It's too bad they didn't follow a similar policy on this session, then it would have been much better that way. Well, now, Joe Salerno was asking, was Rothbard a mainstream economist?

0:46I'd like to ask, suggest to me a similar question, to what extent was Rothbard a mainstream philosopher? And I'd like to suggest one respect in which he was, in which he was influenced by some of the contemporary philosophers of his time. He was a student at Columbia of Ernest Nagel, who was a very important philosopher of science, and he thought very highly of Nagel. Nagel wasn't a logical positivist, although he was somewhat influenced by them, but he was somewhat called a logical empiricist. And one point Nagel stressed very much is that in using a concept in a scientific theory, you have to show how that concept should be applied in practice.

1:36And I think there is kind of a whiff of empiricism in Murray Rothbard in two respects. In talking about preference, he always stresses demonstrated preference, what difference the preference makes in action. You see in his great paper, 1956, Reconstruction of Utility and Welfare Economics, this basic point he uses to criticize in criticizing standard welfare economics is that we just have to operate strictly on demonstrated preference, and if you do that, then you can show that, you can't show that any interference with the free market will increase utility. And another way in which you see this is in his criticism of the concept of monopoly price, he says that people talk about monopoly price, can't show how the monopoly price differs from the competitive price.

2:34So I think here we see possibly the influence of what he learned from Nagel in that respect. He was called a mainstream philosopher. Now the next paper by Vladimir Krauss was a very interesting paper, criticism of Keynes relying on George Reisman. I must tell you one story, Reisman's book, he knows this much better than I do, it's It's an extremely complicated book. When it came out, I was very reluctant to review it because the book is over a thousand pages long and they're double column pages, so it's equivalent to reading at least two books the size of Human Action.

3:23It reminded me of a line from one of Tennyson's poems, but I go on forever. So Reisman wanted me to review it. Usually people don't want me to review their books, but he wanted me to review his. And he said to me, wouldn't you feel bad if you didn't review the book till after I died? And I'm afraid I laughed when he said that. I did review it and I gave it a positive review, but I can't say I understand it all that well. But now, as I understood Mr. Krauss's paper, he claimed that there was a fundamental contradiction in Keynes's system equivalent to 2 plus 2 equals 5, and I'm not clear at all what the Contradiction is Supposed to Be. He said that Keynes wrongly, going against John Stuart Mill, Mill had said demand for commodities is not demand for labor, but Keynes wrongly thought that demand for commodities generates demands for capital goods.

4:44Well, it's not clear to me if suppose Keynes did think, which I think he did, that demand for consumption goods will generate demand for capital goods, that involves him in the claim that demand for commodities is demand for labor, is demand for capital goods, it's just that one will generate the other, and I don't see how even accepting Mill's claim would lead to the view that demand for commodities doesn't generate demand for capital goods.

5:29I'm not saying Keynes was right to think that, but it's not clear what the contradiction is supposed to be. And also, even if, say, Keynes were completely wrong about this, I'm supposing he was involved in going against Mill, I suppose his doctrine did amount to wrongly saying that demand for Commodities is Demand for Capital Goods. I don't see that that would be a contradiction unless he said that, because if you say, say, one thing is something else, if you say something can be both red and blue, it isn't clear that it's a contradiction to say something could be demand for commodities and demand for capital goods.

6:22I don't see what the contradiction is supposed to be, I'm not saying that it is, that Mill was wrong, in fact it seems to me Mill was probably right, but I just don't see what the contradiction is, but I perhaps if I studied Riesman's chapter more thoroughly I would grasp this. Now to turn to Eckhart Kohler, I'm not at all, not only have I not seen his paper, I'm not at all familiar with the Freiburg School. If I could say a little bit about Walter Euken's father, Rudolf Euken, who was a philosopher, but that wasn't the topic of the paper, but two things that did occur to me was when he was talking about the similarities between the Austrian and Freiburg School, he concentrated on the similarities between the monetary proposals of the Freiburg School and Hayek's proposals for monetary denationalization, but one thing I think would be interesting to find out, maybe does this in the paper, is the analysis of the monetary system the same, or is it

7:35just that they come up with similar conclusions? What is the way they actually analyze the monetary system? And then I think it would also been, I wondered, one point that I think Austrians would have some trouble with is including the trade bills in the, what he called the monetary metric. And I think also in addition to comparing the plan with Hayek's proposal, it would be interesting to compare it with the more Mises-Rothbard type of system where you have commodity Money, usually a gold standard and 100% reserve banking. Now to turn to the last very interesting paper by Antonio Massala, the only problems I had with that excellent paper had to do with what he said at the beginning kind of in late 19th or early 20th century background.

8:35I wouldn't think, although there's certainly people who differ with me, it would be accurate to say that Mill, John Stuart Mill, believed in a religion of science or that science could solve our social problems. That's a belief more commonly associated with Auguste Comte. Although Mill was influenced by him, he largely rejected Comte's views. You know, if you look at Mill's posthumously published essays on theism, he doesn't seem to be taking science This is a religion at all. There are people like Maurice Cowling who do incline to that interpretation that he was somewhat of a company, but I tend to think that's wrong. I also don't think Keynes can be viewed as someone who believes in a sort of a science will solve all our problems. If you read Keynes' treatise on probability, he seems very doubtful about about what we can general propositions can establish. He's very much influenced by the philosopher G. Murray. He's rather doubtful about what we can know, especially about knowing

9:47about the future, although he doesn't go so far as Murray did in questioning how much we could know about future consequences of our actions. So I don't think he's really in this scientific tradition at all, but one thing I think Mr. Masala is quite right about is when he stresses how much Thatcher was opposed to the sort of the consensus of the Labour Party and the sort of the sort of the elites of the post-World War II period. I remember I was talking once to my friend Philip Afoot who taught at Oxford for many years, was very much in this elite group. I think she'd been very sympathetic to the Fabian Society.

10:33I said to her, I noticed that Margaret Thatcher had gone to Somerville College, which was her college, and Philippa Foote said to me, oh yes, yes she went, she did go to Somerville, but she wasn't really one of us. So I think that that would be enough from me. I'm sorry.

10:57Thank you very much.