The Misesian Vision

0:00He's the editor of a number of books including The Gold Standard Perspectives in the Austrian School, The Free Market Reader, The Irrepressible Rothbard, the author of two books, Speaking of Liberty, and The Left, The Right, and The State, Geron Soil, and The Bookstore. He is a frequent guest on Judge Andrew Napolitano's Freedom Watch with the Judge on Fox.com, and it's a website you may have heard of, LewRockwell.com. He is a living libertarian legend, the chairman and CEO of the Mises Institute, Lew Rockwell. Thank you, Douglas. Oh, thank you.

0:55I want to mention how lucky the Mises Institute is to have Doug French as our new president, not only because of his vast financial experience, which the Institute has already greatly benefited from, but even of more importance to us, he was Murray Rothbard's student at UNLV, where he received his master's in economics under Murray. So very, very lucky to have Doug. Despite what it says on our schedule, for which I apologize, I'm going to talk about a different topic. I'm going to talk about the Misesian vision. I'm finding it ever more difficult to describe to people the kind of world that the Mises Institute would like to see. With the type of political order that Mises, in the entire classical liberal tradition, believed would be most beneficial for mankind.

1:46It would appear that the more liberty we lose, the less people are able to imagine how liberty might work. It's a fascinating thing to behold. People can no longer imagine a world in which we could be secure without massive invasions of our privacy at every step and even being strip-searched before boarding airplanes, even though private institutions manage much greater security without any invasion of human rights. People can no longer remember how a true free market and medical care would work even though all the problems of the current system were created by Government Interventions in the first place. People imagine that we need 700 military bases around the world and endless wars in the Middle East for security, even though, say, safe Switzerland doesn't. People think it is insane to think of life without central banks, even though these are modern inventions that have destroyed currency after currency. Even meddlesome Some agencies like the Consumer Product Safety Commission or the Federal Trade Commission strike people as absolutely essential even though it is not they who catch thieves and

3:01frauds but private institutions. The idea of privatizing roads or water supplies seems outlandish even though we have a long history of both. People even wonder how anyone could be educated in the absence of the public schools as if If markets themselves didn't create, in America, the world's most literate society in the 18th and 19th centuries, this list could go on and on. But the problem is that the capacity to imagine freedom, the very source of life for civilization and humanity itself, is being eroded in our society and culture. The less freedom we have, the less people are able to imagine what freedom feels like, and therefore the less they are willing to fight for its restoration.

3:52This has profoundly affected the political culture. We've lived through regime after regime at least since the 1930s, in which the word freedom has been a rhetorical principle only, as each new regime has taken ever more of our freedom. Now we have a president who doesn't even bother to pay lip service to the idea of freedom. In fact, I don't think the idea has occurred to Obama at all. If the idea of freedom has occurred to him, he must have rejected it as dangerous, or unfair, or unequal, or irresponsible, or something along those lines. To him and to many Americans, the goal of government is to be an extension of the personal values of those in charge. I saw a speech in which Obama was making a pitch for national service.

4:42The ghastly idea that government should steal two years of every young person's life for slave labor and to inculcate obedience to the Leviathan. Though, of course, no concerns for setting back a young person's career and personal life. How did Obama justify his support of this idea? He said, when he was a young man, he learned important values from his period of community service. It helped form him and shape him. It helped him understand the troubles of others and think outside his own narrow experience. Well, I'm happy for him. But he chose this path voluntarily. It's a gigantic leap to go from personal experience to forcing a vicious national plan on the entire country. His presumption here is really taken from the playbook of the totalitarian state. The father leader will guide his children's To me this comment illustrates one of two things. It could show that Obama is a potential dictator in the mold of Stalin, Hitler and Mao. For the presumptions that he puts on exhibit here are just as frightening as any imagined by the world's worst tyrants.

6:13Or, more plausibly, it may be an illustration of Hannah Arendt's view that totalitarianism can be merely an application of the principle of the banality of evil. With this phrase, Arendt meant to draw attention to how people misunderstand the origins and nature of evil regimes. Evil regimes, she said, are not always the products of fanatics, paranoids, and sociopaths, though, of course, power breeds fanaticism, paranoia, and sociopathology. Instead, the total state can be built by ordinary people who accept a wrong premise concerning the role of the state in society. If the role of the state is to ferret out evil thoughts and bad ideas, it must necessarily become totalitarian. If the goal of the state is that all citizens must come to hold the same values as the great leader, whether economic, moral or cultural, the state must necessarily become totalitarian. If the leaders believe that scarce resources must be channeled in a direction that producers and consumers would not choose on their own, the result must necessarily be

7:29Central Planning. On the face of it, many people today do not necessarily reject these premises. No longer is the idea of a state-planned society seen as frightening. What scares people more today is the prospect of a society without a plan, which is to say, a society of freedom. But here is the key difference between authority and everyday life, such as that exercised by a parent or a teacher or a pastor or a boss and the power of the state. The state's edicts are always and everywhere enforced at the point of a gun. It is interesting how little we think about this reality. One virtually never hears that truth stated so plainly in a college classroom, for example.

8:18But it is the core reality. Everything done by the state is ultimately done by means of aggression, which is to say The total state is really nothing but the continued extension of these status means throughout every nook and cranny of economic and social life. Thus does the paranoia, megalomania, and fanaticism of the rulers become deadly dangerous to every single person. It begins in a seemingly small error, a banality, but with the state, what begins in banality ends in bloodshed. Let me give another example of the banality of evil.

9:05Several decades ago, some crackpots had the idea that mankind's use of fossil fuels had a warming effect on the weather. Environmentalists were pretty fired up by the idea. So are many politicians. Economists were largely tongue-tied, because they had long ago conceded the idea that there are some public goods that the market can't handle. Surely the weather is one of those. Enough years go by, and what do we have? Politicians from all over the world, every last one of them a huckster of some variety, only pretending to represent and his Nation, gathering in a posh resort in Europe to tax the world and planet's weather down to precise temperatures half a century from now.

9:56In the entire history of mankind, there has not been a more preposterous spectacle. I don't know if it counts as tragedy or farce that the meeting on global warming came to an end with politicians rushing home to deal with snowstorms and record-low temperatures. I draw attention to this absurdity to make a more general point. What seems to have escaped the current generation is the notion that was once called freedom. Let me be clear about Not what I mean by freedom. I mean a social or political condition in which people exercise their own choices concerning what they do with their lives and property. People are permitted to trade and exchange goods and services without impediment or violent interference.

10:55They can associate or not associate with anyone of their own choosing. They can arrange their for their own lives and businesses. They can build, move, innovate, save, invest, consume on terms that they themselves decide to find. What will be the results? We can't predict them any more than I can know what everyone in this room will have for breakfast tomorrow morning or what time you will wake up. Human choices work that way. There are as many patterns The only real question we should ask is whether the results will be orderly, that is consistent with peace and prosperity, or chaotic, and thereby at war with human flourishing.

11:41The great burden borne by the classical liberal tradition, stretching from medieval times to our own, is to make believable the otherwise improbable claim that liberty is the mother, not the daughter, not the daughter of orderliness. To be sure, that generation of Americans that seceded from British rule in the late 18th century took the imperative of liberty as a given. They had benefited from centuries of intellectual work by true liberals who had demonstrated that government does nothing for society but divide and loot people in big and small ways. They had come to believe that the best way to rule a society Today this social order sounds like chaos. Not anything we dare try lest we be overrun with terrorists and drug fiends amidst massive social, economic and cultural collapse.

12:43To me, this is very interesting. It is the cultural condition that comes about in the absence of experience with freedom. More precisely, it comes about when people have no notion of the relationship between cause and effect in human affairs. One might think it would be enough for most people to log on to the World Wide Web, browse any major social networking site or search engine, and gain direct experience with the results of human freedom. No government agency created Facebook. No government agency manages its day-to-day operations. It is the same with Google. Nor did a bureaucratic agency create the miracle of the iPhone or the utopian cornucopia of products available at the Wal-Mart down the street.

13:33Meanwhile, look at what the state gives us. The Department of Motor Vehicles. The Post Office, spying on our emails, listening in on our phone calls, full body scans at the airport, restrictions on water use, the court system, wars, taxes, inflation, business regulation, public schools, social security, the CIA, and another 10,000 failed programs and bureaucracies, the reputation of which is no good no matter who you talk to. Now, some might say, oh sure, the free market gives us the dessert, but the government gives us the vegetables that keep us healthy.

14:18That view does not account for the horrific reality that more than a hundred million people were slaughtered by the state in the twentieth century alone, not counting its wars. This is only the most visible cost. As Frederic Bastiat emphasized, the enormity of the costs of the state can only be discovered in considering its unseen costs. The inventions not brought to market, the businesses not opened, the people whose lives were cut short so that they could not enjoy their full potential, the wealth not used for productive purposes but rather taxed away, the capital accumulation and through savings not undertaken because the currency was destroyed or the interest rate held near zero among an infinitely expandable list of unknowns.

15:12To understand these costs requires intellectual sophistication. To understand the more basic and immediate point that markets work and the state does not needs less sophistication, but it still requires some degree of understanding of cause and effect. If we lack this understanding, we go through life accepting whatever exists as a given. If there is wealth, there is wealth and there's nothing else to know. If there is poverty, there is poverty and we can know no more about it. Was to address this deep ignorance that the discipline of economics was born in Spain and Italy, the homes of the first industrial revolutions in the 14th and 15th centuries, came to the heights of scientific exposition in the 16th century to be expanded and elaborated upon in the 18th century in England and in Germany, in France in the 19th century, finally achieving its fullest presentation in Austria and America in the late 19th and 20th centuries. And what did economics contribute to human sciences? What was the value that it added? It

16:25It demonstrated the orderliness of the material world through a careful look at the operation of the price system and the forces at work that organize the production and distribution of scarce goods. Its main lesson was taught again and again for centuries. Government cannot improve on the results of human action achieved through voluntary trade and association. This was its contribution. This was its argument. This was its warning to every would-be social planner, your dreams of domination must be curtailed. In effect, this was a message of freedom, one that inspired revolution after revolution. Each of us stemmed from the conviction that humankind would be better off in the absence of rule than in its tyrannical presence.

17:16But consider what had to come before the real revolutions. There had to be intellectual work that prepared the field of battle. is a chronic struggle that lasted centuries and continues to this day between the nation-state and the market economy. Make no mistake, it is in this battle's outcome that is the most serious obstacle to the establishment and the preservation of freedom. The political order in which we live is but an extension of the capacities of our collective cultural imaginations. Once we stop imagining freedom, it can vanish, and people won't even recognize that it is gone. Once it is gone, people can imagine that they can, or should, get it back.

18:04I'm reminded of the experience of an economist associated with the Mises Institute who was invited to Kazakhstan after the fall of the Soviet Union. He was in part to advise them on a Transition to Free Markets. He talked to important officials about privatization, stock markets, monetary reform. He suggested no regulation on business startups. The officials were fascinated. They had become convinced of the general case for free enterprise, if only because they understood that under socialism, officials were poor. And yet an objection was raised. If people are permitted to open businesses and factories anywhere, then we When we close state-run factories, how can the state properly plan where people live?

18:53After all, people might be tempted to move to places where there are good-paying jobs and away from places where there are no jobs. Kahnem has listened to this point and kept waiting for the objection. He nodded his head that this is precisely what people will do. After some time, the government officials became more explicit. It said that they cannot simply step aside and let people move anywhere they want to move. This would mean losing track of the population. It could cause overpopulation in some areas and desolation in others. If the statement went along with the idea of free movement, it might as well shut down completely for it would be effectively relinquishing any control over the people. And so in the end the officials rejected the idea.

19:40The entire economic reform movement foundered on the fear of letting people move, a freedom that most everyone in the United States takes for granted and which hardly ever gives rise to objection. Now we can laugh about this, but consider the problem from the point of view of the state. The whole reason people, state officials are in office is to control, they are there to to manage society. What they really and truly fear is that by relinquishing controls of people's movements, they were effectively turning over the whole of society to what they would have described as the wiles of the mob. All order might be lost, all security gone. People would make terrible mistakes with their lives.

20:27They would blame the government for failing to control them, and then what happens? The regime loses power. In the end, this is what it always comes down to for the state, the preservation of its own power. Everything it does, it does to secure its power and to forestall the diminution of its power. I submit to you, everything else you hear, in the end, is a cover for that fundamental motive. And yet, this power requires the cooperation of the popular culture. The rationales for power must convince the citizens. This is why the state must be alert to the status of public opinion. This is also why the state must also encourage fear among the population for what life would be like in the absence of the state.

21:19The political philosopher who did more than anyone else to make this possible was not Marx nor Keynes nor Strauss nor Rousseau, as awful as they were. It was the 17th century philosopher Thomas Hobbes who laid out a compelling vision for the nightmare of what life is like in the absence of the state. He describes such life as solitary, poor, nasty, brutish and short. The natural society, he wrote, is a society of conflict, of strife, a place in which no one is safe. He was writing during the English Civil War and his message seemed was unbelievable, but of course the conflicts in his time were not the result of natural society but over the control of Leviathan itself.

22:05So his theory of causation was skewed by circumstance, akin to watching a shipwreck and concluding that the natural and universal state of man is drowning. And yet today Hobbesianism is the common element of both left and right. To be sure, the fears are different, summing from different sets of political values. The left warns us that if we don't have Leviathan, our front yards will be flooded by rising oceans. Big business moguls will rob us blind, the poor will starve, the masses will be ignorant, and everything we buy will blow up and kill us. The right warns that in the absence of Leviathan, society will collapse in cesspools of immorality lorded over by swirly terrorists preaching a heretical religion.

23:03The goal of both left and right is that we make our political choices based on these fears. It doesn't matter so much which package of fear you choose. What matters is that you to support a state that purports to keep your nightmare from becoming a reality. Is there an alternative to fear? Here is where matters become a bit more difficult. We must again begin to imagine that freedom itself could work. In order to do this, we must learn economics. We must come to understand history better. We must study the sciences What they knew is the great secret of the ages. Society contains within itself the capacity for self-management, and there is nothing that government can do to improve on the results of the Voluntary Association, Exchange, Creativity and Choices of Every Member of the Human Family.

24:16If you know this lesson, if you believe this lesson, you are part of the great liberal tradition. You are also a threat to the regime, not only the one we live under currently, but every regime all over the world, in every time, in every place. The greatest guarantor The power of liberty is an entire population that is a relentless and daily threat to the regime precisely because they embrace this dream of liberty. The best and only place to start is with yourself. This is the only person that you can really control in the end. And by believing in freedom yourself, you might have made the biggest contribution to civilization you could possibly make.

25:06After that, never miss an opportunity to tell the truth. Sometimes thinking the unthinkable, saying the unsayable, teaching the unteachable is what makes the difference between bondage and sweet liberty. The title of this talk is The Misesian Vision. This was the vision of Ludwig von Mises and Murray and Rothbard. It is the vision of the Mises Institute. It is the vision of every dissident intellectual who dared to stand up to despotism in every age. I challenge you to enter into this struggle of history and make sure that your days on this earth count for something truly important. It is this struggle that defines our contribution to this world.

25:53Freedom is the greatest gift that you can give yourself and give all of humanity.