Mises in New York

0:00I want to thank Gary Schlaubauer for this award and honor. From your gift, Mr. Schlaubauer, in loving memory of a genius in our time, Ludwig von Mises, You know, I say up front, as Bill Anderson tipped you off, serendipity is something that we all incur, but mostly not aware of it, but you had some instances where it was Lady Aston and Mary Bennett, now Mary Bennett Peterson, put that to good work.

0:46Now, I'm here, quite frankly, as Mr. Serendipity. I'm here by a fluke, by my view of myself as a son of fickle fate. For frankly, I never heard of famous Ludwig Mises when I took his and really chose the course for its time of Monday night from 8 to 10. It just fit my schedule beautifully. But Ms. Sessians, night school was fine for me an assistant economics prof at Brooklyn Polytech. But night school for genius like Mises?

1:31Ask why did no top university here or in Europe find him a chair? Good question. Murray Rothbard gave three reasons. One, Mises was a Jew in the first half of the 20th century when anti-Semitism ran high. Two, Mises was a laissez-faire for lean, non-interventionist government to protect person and property only. And three, Mises was a non-compromiser, a rock of Gibraltar, refusing to back politically correct Marxism, Keynesianism, welfareism, funny money or state hegemony.

2:16But what of academic freedom? Well, even NYU, if giving Mises a visiting professorship he's so visited for 24 years, denied him any pay whatsoever, that money had to be raised outside. Oh, for shame! For shame, you lords of academe, here and abroad! If happenstance became circumstance, I soon met like-minded fellow students like Murray Rothbard, George Riesman, Hans Senholtz, Israel Kirzner, Ralph Rago, and Louis Spadaro, who with Mises as a catalyst made names for themselves in Austrian literature.

3:07Soul energy blossomed on NYU's Washington Square. So let me, Mr. Serendipity, add proudly, Ludwig became my mentor, a dear friend and colleague at NYU from 1950 on until the world lost him in 1973, lost but not forever, Thanks to his sweeping ideas, and to this lively, working memorial, the Mises Institute, the think tank that keys human action, that sees history as anything but pre-determined, that puts to America Hamlet's fateful question, explored here tonight, to be or not to be.

3:56fellow Mississians, Contrarians for now, but to me libertarians for ever. How well I remember Lou Mises and his dear wife Margaret. Margaret often came with him to class and after studying typing and stenography at a Manhattan Secretarial School, This glamorous star of the Berlin and Vienna stage came to type every page in English of all 900 pages of the Mises Magnum Opus, Human Action, 1949. I ask you, isn't such human action truly a labor of love? And also with Lew's firm rule of having Margaret correct an occasional typo by re-tapping the entire page.

4:49Here then, Margaret Mises, a giant in her own right, it was visionary, Margaret, who approved the founding of the Mises Institute in 1981, with that mission accomplished in 1982, backing the project with other giants such as F. A. Hayek, Lawrence Fertig, Henry Hazlitt, and Murray Rothbard, who led academic programs here until his death in 1995. Think Tank execs of the caliber of Lew Rockwell, Pat Barnett and Jeff Tucker closed the deal to put this great think tank of hope, of new reform on the intellectual idea front.

5:44Let's celebrate, then, the vast life of Lew Mises, a life in which he fused lifelong moral courage with crowning insight on how the world tackles or fumbles the law of scarcity. He showed that courage in class. As a great teacher, I was there. And in academic debate as a great fighter, as Margaret tells in a book, Look, my years with Ludwig von Mises. He was also, in the view of F. A. Hayek, his Nobel Prize student, a great radical, an intelligent and rational radical, but a radical on the right lines.

6:29Mises, a radical and non-conformist, yes, but so were Aristotle, Galileo, Adam Smith and Einstein in their own non-conforming day. In the light of such courage, yours as well as his, let's discuss some of his big ideas, dwelling on one, to me, most hopeful idea, The definition and application of a much overworked and much misunderstood word, democracy. Political democracy, I say, is commonly but wrongly equated with freedom.

7:14As shown in history, as I will cite, yet in the Mises market sense of the word, it does equate with freedom beautifully, effectively. Getting, for example, not a biennial 50% or so of election turnout, but 100% daily election turnout of Americans and other Westerners. Call it direct democracy. Call it market democracy. Above all, call it voluntary democracy. Why don't we call it what it is, America's true democracy? Now, Misesians, let's salute Lew Mises, the dean, the architect of Austrian Economics in the 20th century, as was Carl Menger in the 19th.

8:05Menger, it was well said, founded the Austrian School in 1871 on the intellectual bedrock of subjectivism and marginal utility as the basis of value. Mises built that idea into the very title and theme of Human Action, so Mises caught squally then, the role of the acting individual, a lost soul in most mainstream and all mathematical economics, thus what Mises forged intellectually is praxeology, the vision, that purposeful Human behavior and action, including division of labor, is central to society, central to social cooperation and to Western civilization itself.

8:59So to us, praxeologists here gathered, from thinking into individual behavior, Lew Mises saw human action affecting all of us in how we act and think and pursue our lives. An analogy, if you please, they can't held in 1637. I think, therefore I am. I say Mises held. I think, therefore I act. So thought begets action. Human action is acting consciously, voted by gain, perhaps after a snap judgment, perhaps after deliberation, from scratching your nose, to changing careers, to rethinking economics on Austrian lines.

9:56By the way, if every human action hangs on gain, pecuniary or non-pecuniary, doesn't every so-called non-profit organization become, if you will, a contradiction in terms? No wonder our Brigham on Neocon and Neoconning White House worships the god of political democracy, as do our media legislatures and school textbooks all echo the World War I President Wilson motto of make the world safe for democracy. But what of its curse of politics, timeless ubiquitous politics, the contagious corruptor of political democracy and its minions from ancient Greece to America today as implied in the title of Mises Institute Distinguished Scholar Hans-Hermann Hoppe's 2001 book, Democracy, the God that Failed. Or as implied by Hamlet, standing in a Danish graveyard at night and holding up a skull and wondering if it at once belonged to a politician whom All Misesians see how America's Founders themselves saw political democracy, quoting self-ruined as many voters joined factions of special interests.

11:32James Madison spoke for his peers in Federal Papers Number 10, seeing democracies as, I Spectacles of turbulence and contention, which have ever been found incompatible with personal security, all the rights of property, and have in general been as short in their lives as they have been violent in their deaths. It was Han Mises who lit up a near unknown, yet much safer and surer democracy, a way out of our definitional crisis, if you will. And in 1922, in another great book, Socialism, he saw a democracy at work in market action.

12:19Action, CD yourself, shopping malls, online buying, getting codes from vending machines, filling up the gas pump by credit card, business consumers ordering supplies for their operations. So these and other market voters vote not but every other year, but again and again every day, freely, directly, in a way one-on-one, you will like your supplier, you get what you order, you are sovereign, great, yet do take care, you and I are still under an ancient Roman edict, to consumers, caveat emptor, let the buyer beware.

13:07Oh, I see Mises and Socialism giving market democracy a vital political edge today, if we use it, here and seek to put his brilliant edge, his near law, into public opinion play. Per, and I'm now quoting him, When we call a capitalist society, a consumer's democracy, we mean that the power to dispose of the means of production, which belongs to the entrepreneurs and capitalists, can only be acquired by means of the consumer's ballot, held dearly in the marketplace. Mises, right again, spent his life seeking limits on loudly trumpeted political democracy for ponder why so many big government snares and delusions today.

14:02For example, who rules whom? Why state hegemony, heavy taxation, intervention of the law, swelling bureaucracy and thick public, government, schools, that is sick from four basic ills, one, peddling, peddling, moral relativism, two, teacher unions, three, denial of competition and its kiss of death, denial of choice, where even every child in a very strong sense gets left behind, if you read me. Thank you. In the U.S., for example, we have an endless form of legal law, and I'm now referring to the constant deterioration of the buying power of money, fiat money.

15:08In the US, for example, NDs charged, when I was a boy, $2 for an office visit, $3 for a home visit, and we had several home visits. Now there are no more home visits. But now an office visit can cost $80 or more. When then, a first class stamp cost 2 cents, now it costs 37 cents. When a New York subway ride cost a nickel, but now it costs two dollars? Or ponder why, though, winner-take-all elections tend to split society, us versus them? How come the war on poverty tends to kill off its very cure by subtly sabotaging production?

15:55or why ongoing bungling, brain gaming, before and after Hurricane Katrina, or why endless Iraqi insurgency violence, or why suicide bombers in New York, Madrid, London and elsewhere. Three cheers then for Lew's perception of state intervention as the culprit, while market democracy is productive and peaceful, peaceful, look, mindful of terrorist about, doesn't capitalism or social cooperation across borders say it's stupid, stupid to shoot your customers or bomb your investors. So harming your very own people dependent on world prosperity.

16:48So in current debate on economic policy, I urge you to perceive and work for peaceful, productive democracy which could come to be rethought, reinforced, even reborn as it could, it follows, human liberty. Why? Well, call it power to the individual. Call it laissez-faire capitalism. Call it, in the so-called war on terrorism, world peace through world trade. The wise idea of IBM founder Thomas J. Watson in the interwar period of the 20s and 30s. is called the way of the choosy, choosing sovereign consumer. You, for example, just crass political democracy and a bipartisan welfare state persists. An initial, 2006, $2.5 trillion red ink federal The monster so frightful, mean, as to be hated, needs but to be seen, but seen too oft, familiar with the world,

18:14Life, he said, is a monster, so frightful, mean, as to be hated, needs but to be seen, but seen too oft, familiar with the face, we first endure, then pity, then embrace. Or as Mae West cast such human frailty, she said, I began as Snow White, but I drifted. No wonder that in 1956, or 49 years ago, Mises felt pushed to publish a book, The Anti-Capitalist Mentality. But now anti-capitalism is more rife than ever. Indeed, Hayek, Mises's star pupil, felt a duty in 1988, 32 years later, to do a book on the same lines that they will concede the errors of socialism.

19:12Recall this is the same Hayek who did the best-selling The Road to Serfdom in 1944 as we now half-serfs tread the very same road as President Bush II seeks to join IRAs to Social Security as part of his so-called ownership society. if with paternalistic control, if with a huge amount of unfunded lien on your property and heirs in the here and now as well as in the hereafter. Oh, how clever are compassionate conservatives, so compassionate with other people's money.

19:57Conservatives, I ask you, Ms. Sessians, ask a conservative friend of yours, how come Hayek added a PS, a postscript, why I am not a conservative, to his 1960 book, The Constitution of Liberty. To Hayek, conservatism is simply too unprincipled, too neocond in today's word. For our part, we Austrian economists and supporters are people of insight, not devotees of blind fate. I'm reminded of a story told by Margaret Mises, once watching her husband play tennis with a coach. I know the coach and I know the... I was on Larry Firding's court.

20:47Anyway, she called out, well, how come you don't put more effort into the game? He shouted back, why should I? The fate of the ball does not concern me. What did concern, what did concern was the folly of political democracy in pursuing state intervention or piecemeal socialism or its phase of planned chaos. The mirage that officialdom can somehow better our lot, nobly, selflessly, sure, just as it does now for government-battered, scattered New Orleans. Or as it did under prohibition, the noble experiment, 1920 to 1933.

21:35The U.S. ban on production and sale of alcoholic beverages, touching off a national epidemic of black markets and gangsters a la Legs Diamond and Lucky Luciano, making headlines, I remember the headlines, didn't understand them entirely, via street warfare, yet again, Congress got the 21st Amendment to repeal the 18th, great, but it's still left intact, the now nascent The then-Mason, now virulent, war on drugs, with deadly implications for domestic policy today in terms of renewed warfare, for foreign policy getting the U.S. into a hopeless war on drug traffic from Colombia in South America to Afghanistan in Asia.

22:24But our law would have had none of it. Here I meant human action, and I quote, Opium and morphine are certainly dangerous habit-forming drugs, but once the principles are meted, that is, it is the duty of government to guard the individual against his own foolishness, no serious objection can be made against further encroachments. If one ends man's freedom to determine his own consumption, one takes all freedoms away. Way. We then are berated, underrated and misread capitalism. Isn't it still? Pay our founders, if Marx had yet to coin the word, a royal road to social cooperation, a vast vital network of private governments, all with highly used individual switchable assent. Switchable?

23:18All right. See in America, countless private governments such as the New York Times, Walmart, Salvation Army, the Mises Institute itself, and some 30 million other private firms, farms and NGOs of all kinds. Yet all rely on switchable individual ascent. So you're free to switch from Ford to Toyota, from Yale to MIT, from Wendy's to McDonald's, and vice versa, talk of true private democracy. So let's juxtapose, just now, America's coercive political democracy with Lew's voluntary market democracy to see which is which and why.

24:04I ask you, with both in need of reform, which needs all-out drastic reform. I know you know, but the general public doesn't. One democracy is public, the other private. One views socialistic and pro-state as it funds failing programs and public schools. The other view is capitalistic and pro-consumer and it lets failing firms and private schools fail. One is coercive and centralized, the other voluntary and decentralized. One runs inevitably a growth impeding, win-lose, zero-sum game without a guiding market system or economic calculation.

24:51And I'll spell that out in a moment via Mises. The other runs a pro-growth, win-win, positive-sum game via a guarding market system and economic calculation. One democracy, run by politics, monopoly, win-and-take-all, hoopla on mindful of H.L. Mencken's line that such democracy yields the worship of jackals by jackasses. Or on Henry David Thoreau's Civil Disobedience of 1849 when he saw little virtue in the action of masses of men voting as a sort of gaming. The other democracy runs by human action and free trade.

25:39One democracy bears to the Machiavellian a morality in the short run, such as credit expansion aimed at winning elections as courting inflation and recession. I'm glad to get Lew's book by Rothbard on, and I commend the book to you, fiat money. Anyway, one with coercive power yields to Acton's law that power tends to corrupt and absolute power corrupts absolutely, or to Frank Chudorov's view of Washington's work as the rape of society, or to Harry Truman's truism That if you ever need a friend in Washington, buy a dog, or to the no-brainer, that someday the welfare welfare state will wise up and swear off sin, sure, but go to the side instead of Oakland, California, say we, Austrians, say a bankrupt state interventionism, there is no there there.

26:42One democracy glorifies war, including class warfare, and the other glorifies peaceful trade in a virtual global accord on exchanging private property, if widely derided as globalization. World War I, naively, as again, I said earlier, make the world safe for democracy, only to reap, how is this for a cast of characters? Lenin and Stalin in Russia, Hitler in Germany, Mussolini in Italy, France in Spain, Tojo in Japan, Tito in Yugoslavia, Mao in China, Peron in Argentina, Castro in Cuba, Allende in Chile, Paul Parton in Cambodia, Chavez in Venezuela, Mugabe in Zimbabwe, almost all of whom faked or fake political democracy, to get and hold power as have lesser imitators over the world.

27:46One democracy rules income disparity and like Robin Hood, blithely transfers wealth from the haves to the have-nots. The others saw both, including those of the poor. One denies itself key market feedback data, or what von Mises called, that aforementioned market-driven economic calculation. In 1920, he brilliantly saw its lack as the key to the sure failure of socialism, a thesis he expanded in his 1922 classic, Socialism. Socialism, so you saw or see Socialism collapse or incapability reign in the USSR, Eastern Europe, China and welfare and intervention everywhere witnessed it in spades in America.

28:40Yet market democracy does capitalize on prices and profit and loss to get scarce resources to their perceived best uses, or he uses in his 1944 book, bureaucracy. There are two methods for the conduct of human affairs within the frame of human society. One is bureaucratic management, the other is profit management. But bureaucratic management, without market pricing and economic calculation, flies blind. It saps fairest capital and talent in the tragedy of the commons, as special interests horn in on each other to grab all they can, while profit management saves and invests capital, the very tools of economic growth.

29:29Self-interestedly, how else? Under private property rights and the rule of law, it does so spontaneously, harmoniously, creatively. Hayek called this remarkable, self-guiding market process of economization, productivity gain, economic growth, and this is his word, a marvel. No question then, capitalism, Lew's market democracy, is America's true democracy, that it's the opposite of a bipartisan, welfare, warfare state of coercive, When to take all democracy is the case of a great nation chasing its tail, or to cast Lewis as a kind of a role model, or a modern day Moses who implores Egypt's pharaoh, that is, myopic status rulers today, let my people, the consumers, go.

30:33Three challenges remain as I see it. First, the need of steady insight, or in loose words, the issue is always the same, the government or the markets. There is no third solution. The second challenge, how can we use market democracy and other means to help tame political democracy as our founding fathers did in 1776? or willy-nilly, let it slowly but surely snuff out our livelihood, our civilization. And challenge number three, the need for time, the free market idea, to a moral code based on virtue, dignity and wisdom. Or on the Ten Commandments, as shown on our Mises Institute shield, and there it is, up here, on the way out.

31:25Please study it, because in the lower left hand corner you will find the Ten Glorious Commandments, not spelled out, but enumerated from one to ten. Not bad. But given human weakness, while the supermarket, the free market is a super thing, as real as an ideal will ever get to see, I say, given human weakness, it's not nirvana, or instead of healthy living, eat well, stay fit and die anyway. But recall what happens right on, because we're back to Hamlin's question for America, to be or not to be.

32:20Right on in the soliloquy is yet another question, and I quote, whether it is noble in the mind to suffer the slings and arrows of outrageous fortune or to take arms against a sea of troubles and by opposing end them. Let me tackle both questions. First, let's be Misesians alive, active, alert, able. Second, let us oppose hypocrisy in an increasingly unlimited, adversarial, anti-consumer, ultimately fatal, welfare, warfare, leviathan. It doesn't leviathan itself come down to one big, bad idea. Paul Misesians, Paul Adilou, Ideas Rule the World, Ideas Change, But Only Ideas Can Overcome Ideas So here is the sum of my summit visit with you.

33:19I enlist each one of you to personally scour and plug Austrian ideas, to stay tuned, stay resolute, Stay optimistic, stay strategic, stay innovative, stay responsive, stay responsible, stay entrepreneurial, stay profitable. Increasingly so if you can, so deserves society all the more. And last, stay strong and true for the Ludwig von Mises Institute, its people, programs, and above all, its ideas. Ideas. Think. Ideas breed consequences. Good and bad. Think. We shall overcome the bad.

34:05As your serendipitous friend Bill Peterson closes this pep rally with, thank you very much, fellow Misesians.