WEBVTT NOTE The Scholastic Legacy of Murray N. Rothbard in the History of Economic Thought 1 00:00:00.000 --> 00:00:06.960 My paper this afternoon is a is a preliminary attempt to trace Rothbard's legacy in economic thought 2 00:00:08.360 --> 00:00:15.420 Murray and Rothbard's contribution to the revival and newfound appreciation of the medieval and early modern 3 00:00:15.720 --> 00:00:21.560 scholastics I think is one of his greatest lasting achievements, and I know Murray has had a lot of lasting achievements 4 00:00:22.000 --> 00:00:29.640 No other book before or since has chronicled the importance and legacy of scholasticism as much as economic thought before Adam Smith 5 00:00:30.000 --> 00:00:41.000 Certainly, I think everyone should have a copy of this, both the Economic Thought Before Adam Smith, as well as the second volume, which is Classical Economics. 6 00:00:41.000 --> 00:00:47.000 They're both masterful works. And of course, Economic Thought Before Adam Smith is that first volume. 7 00:00:47.000 --> 00:00:59.000 His work not only sketched more than 50 minor, and again, in quotes, minor, these are minor scholastics, which I placed up here. 8 00:00:59.000 --> 00:01:15.000 And if you can notice, some of them of course are philosophers, all scholastics working within the tradition of scholasticism, taking us all the way to 1663, the latter part of the 17th century. 9 00:01:15.000 --> 00:01:26.000 The major writers, again in quotes major writers, from St. Albert the Great all the way to Juan de Lugo. 10 00:01:26.000 --> 00:01:41.000 So his work not only sketched more than 50 minor and major scholastic writers in their works, but also dismissed, and he says this in his introduction, the few great men approach as deficient and imprecise. 11 00:01:41.000 --> 00:02:00.000 As Rothbard says, quote, the cut and thrust of history itself, the context of the ideas and movements, how people influenced each other and how they reacted to and against one another is necessarily left out of the few great men approach, end quote. 12 00:02:00.000 --> 00:02:12.000 Not only was Rothbard strongly influenced by the revisionist contributions of Joseph A. Schumpeter, Raymond de Ruver, Marjorie Grace Hutchison, and John T. Noonan, as well as Emil Kauder. 13 00:02:12.000 --> 00:02:22.000 And just to throw in, obviously, the influence of Joseph Dorfman, his dissertation mentor at Columbia College at the time of Columbia University. 14 00:02:22.000 --> 00:02:27.000 But he also added his own unique Austrian perspective to the literature. 15 00:02:27.000 --> 00:02:38.000 Realizing that important knowledge and personalities had been lost by modern economic historians, Rothbard set out to recast the contributions of the scholastics in a decidedly positive light. 16 00:02:38.000 --> 00:02:51.000 He writes, it turns out that the scholastics were not simply, quote-unquote, medieval, but begun in the 13th century and expanded and flourished through the 16th and into the 17th century, end quote. 17 00:02:51.000 --> 00:03:00.000 Identifying the scholastics as proto-Austrian, Rothbard underscored the importance of studying their methods and appreciating their contributions in the following passage. 18 00:03:00.000 --> 00:03:10.000 Quote, Far from being cost of production more or less, the scholastics believed that the just price was whatever price was established on the common estimate of the free market. 19 00:03:10.000 --> 00:03:18.000 Furthermore, some of the scholastics were far superior to current formalist microeconomics in developing a proto-Austrian dynamic theory of entrepreneurship. 20 00:03:18.000 --> 00:03:34.000 Moreover, in macro, the scholastics beginning with Byrd and culminating in the 16th century Spanish scholastics worked out in Austrian rather than a monetarist supply and demand theory of money and prices and even a purchasing power parity theory of exchange rates, end quote. 21 00:03:34.000 --> 00:03:51.000 This rediscovery of the significance of scholasticism and scholastic thought emerged out of, as Rothbard again says, European-trained economists steeped in Latin, the language in which the scholastics wrote. 22 00:03:51.000 --> 00:04:08.000 He goes on, he says, it is no accident that the Austrian School, the major challenge to the Smith-Ricardo vision, arose in a country that was not only solidly Catholic, but whose values and attitudes were still heavily influenced by Aristotelian and Thomas' thought. 23 00:04:08.000 --> 00:04:15.000 Again, as he says, the studying of history and ideas should be an important part of every economist's toolbox. 24 00:04:15.000 --> 00:04:20.840 He writes, for if knowledge buried in paradigms lost can disappear and be forgotten over time, 25 00:04:20.840 --> 00:04:26.440 then studying older economists in schools of thought need not be done merely for antiquarian purposes 26 00:04:26.440 --> 00:04:31.400 or to examine how intellectual life proceeded in the past. Earlier economists can be studied 27 00:04:31.400 --> 00:04:36.440 for their important contributions to forgotten and therefore new knowledge today. Valuable 28 00:04:36.440 --> 00:04:42.120 truths can be learned about the content of economics not only from the journals but from 29 00:04:42.120 --> 00:04:46.360 from the Texts of Long, Deceased Thinkers. 30 00:04:46.360 --> 00:04:49.860 So I went down to my basement 31 00:04:49.860 --> 00:04:51.960 and went through a couple of boxes 32 00:04:51.960 --> 00:04:55.520 which were labeled histories of economic thought 33 00:04:55.520 --> 00:04:58.460 and began thumbing through the various texts, 34 00:04:58.460 --> 00:05:01.460 both the older texts and some of the newer texts. 35 00:05:01.460 --> 00:05:07.320 And not to my surprise, Rothbard's first volume, 36 00:05:07.320 --> 00:05:10.360 His Economic Thought Before Adam Smith, 37 00:05:10.360 --> 00:05:19.420 had a huge section, obviously, on the scholastics, and I think that's the major significance. 38 00:05:19.420 --> 00:05:26.240 So if we look and see, obviously, the amount of pages, and again, we can get into the fonts 39 00:05:26.240 --> 00:05:31.920 and the sizes and so on and so forth, but anything coming close to any kind of scholastic 40 00:05:31.920 --> 00:05:37.140 analysis is Joseph Schumpeter's History of Economic Analysis, which was published posthumously 41 00:05:37.140 --> 00:05:40.700 in 1954. 42 00:05:40.700 --> 00:05:46.180 I was ill-advised one semester in assigning Schumpeter's text 43 00:05:46.180 --> 00:05:51.340 as the primary text in a history of economic thought class, 44 00:05:51.340 --> 00:05:56.660 and I have never used it since, simply because, yes, he's 45 00:05:56.660 --> 00:05:59.940 very erudite, yes, he's very complete in some respects, 46 00:05:59.940 --> 00:06:03.300 and yet he is very difficult to read, 47 00:06:03.300 --> 00:06:06.900 whereas Rothbard's sort of Dorfman-like style 48 00:06:06.900 --> 00:06:10.140 really endears oneself to continuing to read this 49 00:06:10.140 --> 00:06:13.580 and get an appreciation, especially for the scholastics. 50 00:06:13.580 --> 00:06:16.460 Third on the list is Henry Spiegel's 51 00:06:16.460 --> 00:06:18.580 The Growth of Economic Thought 52 00:06:18.580 --> 00:06:20.620 out of Catholic University, 1971. 53 00:06:20.620 --> 00:06:24.980 38 pages of scholastics, of which Murray Rothbard 54 00:06:24.980 --> 00:06:27.940 culled some of Spiegel's work as well. 55 00:06:27.940 --> 00:06:30.140 The Eklund and Eber text, which I think is 56 00:06:30.140 --> 00:06:32.260 in about the fifth edition now, 57 00:06:32.260 --> 00:06:35.120 which I use from time to time, 58 00:06:35.120 --> 00:06:44.300 again has thirteen pages, so I judiciously use that text as more related to modern economic 59 00:06:44.300 --> 00:06:51.160 thought as opposed to scholastic economic thought. Lewis H. Haney, in which Rothbard 60 00:06:51.160 --> 00:07:00.040 sort of rails at Haney for his very short shrifting of the scholastics as well, has 61 00:07:00.040 --> 00:07:30.040 with 11 pages, Charles Staley, a new text, 10 pages, Alessandro Rancaglia's The Wealth of Ideas, which was somewhat of a hit in 2005, has 10 pages, the old John Fred Bell text, which is much more interesting when you talk about classical economics, 8 pages, Edmund Whitaker's old 1960 text, 6 pages, 62 00:07:30.040 --> 00:07:36.920 2002, History of Economic Thought, six pages, and Stanley Brew has none, and I could have 63 00:07:36.920 --> 00:07:42.160 listed a lot of others that had no pages at all. 64 00:07:42.160 --> 00:07:50.760 Again, I think the fact that Rothbard was able to use some of the great research that 65 00:07:50.760 --> 00:07:58.600 was available to him at the time and to add to it is really the legacy for us today. 66 00:07:58.600 --> 00:08:06.200 A little bit about scholasticism, and I think why Murray was certainly attracted to it. 67 00:08:06.200 --> 00:08:11.280 With newly translated texts of Aristotle as one of its dialectical focal points, along 68 00:08:11.280 --> 00:08:17.160 with the Old and New Testaments, various patristic writings on the Roman jurists, scholasticism 69 00:08:17.160 --> 00:08:22.720 was, quote, essentially a rational investigation of every relevant problem in liberal arts, 70 00:08:22.720 --> 00:08:27.440 philosophy, theology, medicine and law, and examined from opposing points of view in order 71 00:08:27.440 --> 00:08:32.840 to reach an intelligent, scientific solution that would be consistent with accepted authorities, 72 00:08:32.840 --> 00:08:35.880 known facts, human reason, and Christian faith. 73 00:08:35.880 --> 00:08:38.920 I think he was really attracted by that. 74 00:08:38.920 --> 00:08:42.060 There was a, there's substance to it. 75 00:08:42.060 --> 00:08:48.240 Beginning with St. Anselm, writes James Hitchcock in his recently published book entitled, Just 76 00:08:48.240 --> 00:08:52.560 Simply a History of the Catholic Church. 77 00:08:52.560 --> 00:08:57.260 Beginning with St. Anselm, who defined theology as faith seeking understanding, in that the 78 00:08:57.260 --> 00:09:02.400 The truths of faith can be neither proved nor disproved by human reason, but men are 79 00:09:02.400 --> 00:09:07.960 obliged to use reason to understand them as far as possible. 80 00:09:07.960 --> 00:09:11.700 Scholasticism spread as a system of logical investigation for studying various topics, 81 00:09:11.700 --> 00:09:12.700 including economics. 82 00:09:12.700 --> 00:09:17.940 It included, says John T. Noonan, the men who were the acknowledged intellectual and 83 00:09:17.940 --> 00:09:21.940 moral leaders of all of Europe for several hundred years, and the men who were the acknowledged 84 00:09:21.940 --> 00:09:25.420 leaders of part of Europe for later centuries. 85 00:09:25.420 --> 00:09:45.420 Deeply rooted in natural law theory, the medieval schoolmen turned their attention to numerous economic topics including the theory of money, value, and price, the defense of private property, public finance, entrepreneurship, distributive justice, not social justice, wages and profits, international trade and exchange, and interest. 86 00:09:45.420 --> 00:09:49.420 Although this system of thought would continue to be influential throughout Europe, 87 00:09:49.420 --> 00:09:59.420 scholasticism's greatest exponent was, as I had put on the first slide, the Jesuit Cardinal, Juan de Lugo. 88 00:09:59.420 --> 00:10:08.420 Although Lugo takes scholasticism well into the 17th century, his penetrating analysis of subjective utility was, according to Rothbard, 89 00:10:08.420 --> 00:10:13.360 quote, the culminating work of the Salamancon School, end quote. 90 00:10:13.360 --> 00:10:15.260 Unfortunately, scholasticism's demise 91 00:10:15.260 --> 00:10:18.340 is summed up by de Ruver in the following way, quote, 92 00:10:18.340 --> 00:10:21.900 the demise of scholasticism is not limited to economics, 93 00:10:21.900 --> 00:10:24.660 of course, but involves the entire scientific 94 00:10:24.660 --> 00:10:27.820 and philosophical system born in the medieval universities 95 00:10:27.820 --> 00:10:31.820 and still far from morbid on the eve of the 17th century. 96 00:10:31.820 --> 00:10:34.100 In the face of attack, the Aristotelians 97 00:10:34.100 --> 00:10:37.180 fail to realize that in order to survive, 98 00:10:37.180 --> 00:10:57.180 They had to renew their methods. Instead, they stubbornly refused to accept the new discoveries in experimental science, with the inevitable result that their philosophy shared the fate of their antiquated astronomy, physics and medicine, and along with them, fell into complete disrepute or discredit. 99 00:10:57.180 --> 00:11:13.180 Since the publication of Murray Rothbard's work nearly 20 years ago, numerous scholars have advanced a better and more complete understanding of scholasticism through monographs and journal articles, new translations of long forgotten Latin texts, 100 00:11:13.180 --> 00:11:43.180 The Mises Institute has been at the forefront with the republication of the two-volume work but especially, most especially for my purposes, economic thought before Adam Smith in 2006, other works of course in the bookstore of the Salomonkin School by Marjorie Grice-Hutcherson and others as well, and organizations such as 101 00:11:43.180 --> 00:11:52.180 such as the Juan de Mariana Institute, founded in 2005, named after the work and ideas of the 16th century Spanish scholastic. 102 00:11:52.180 --> 00:12:01.180 One such advancement has been the recent partial translation, and I say partial because, again, 103 00:12:01.180 --> 00:12:09.180 Lesius' work is over 800 pages of very tightly typed, dense Latin text. 104 00:12:09.180 --> 00:12:24.180 But the recent translation of Leonidas Lesius' De Justizia et Ure of Justice and Right, first published in 1605, was done by Wim Decock. 105 00:12:24.180 --> 00:12:30.180 His translation further enhances Rothbard's commentary on Lesius' most significant contributions, 106 00:12:30.180 --> 00:12:39.580 including the just price, loan contracts and markets, wages and the labor market, entrepreneurship, money and credit, usury and titles of interest. 107 00:12:39.580 --> 00:12:47.580 But again, his translation is snippets. It's a paragraph here, it's a paragraph there. Again, it's not the complete translation. 108 00:12:47.580 --> 00:12:58.080 That would literally be, I think, a lifetime of work. And there are, again, as I put up the two front slides of various scholastic writers 109 00:12:58.080 --> 00:13:23.080 So as one of the last great scholastics' interests in his work by Barry Gordon, Louis Beck, and others, including Murray Rothbard, has had its own specific impact on a growing body of work within the sub-discipline of economic thought. 110 00:13:23.080 --> 00:13:32.440 A few words about the work itself, and then some closing comments. 111 00:13:32.440 --> 00:13:40.640 Lesia's most important work was his De Justicia et Ore, On Justice and Right, published in 112 00:13:40.640 --> 00:13:41.640 1605. 113 00:13:41.640 --> 00:13:48.640 This work circulated throughout the 17th century in Europe, with the cities of Antwerp, Louvain, 114 00:13:48.640 --> 00:13:52.840 Lyon, Paris and Venice publishing most of his editions. 115 00:13:52.840 --> 00:13:59.260 His work is divided into four books, which most of these on justice and right sort of 116 00:13:59.260 --> 00:14:05.720 compendiums were at the time, which incorporate the four cardinal virtues, de prudencia, of 117 00:14:05.720 --> 00:14:16.440 prudence, de justicia, of justice, de fortitudine, of fortitude, and de temporencia, of temperance. 118 00:14:16.440 --> 00:14:24.280 Not surprisingly, of the 808 pages of text in my Antwerp, Planton, Moretus, 7th edition 119 00:14:24.280 --> 00:14:33.040 of 1632, 683 pages of that text is dedicated to an examination of justice. 120 00:14:33.040 --> 00:14:41.640 And within the section of his treatise, Lesius devotes nine chapters to book two, to economics, 121 00:14:41.640 --> 00:14:45.560 to finance, banking and international trade. 122 00:14:45.560 --> 00:14:59.360 And again, these are the sections in which Wim D. Koch has recently done his translation. 123 00:14:59.360 --> 00:15:05.760 I believe the scholastic legacy of Murray and Rothbard in the history of economic thought 124 00:15:05.760 --> 00:15:07.960 is essentially threefold. 125 00:15:07.960 --> 00:15:14.660 First, his rejection of the few great men approach, and he didn't like the few great 126 00:15:14.660 --> 00:15:21.160 and the Great Men Approach, because again, if you take a look at the multi-volume history 127 00:15:21.160 --> 00:15:31.520 of American intellectual history by Joseph Dorfman, if you read Rothbard side-by-side 128 00:15:31.520 --> 00:15:35.540 and read Dorfman at the same time, you'll understand where he got his style. 129 00:15:35.540 --> 00:15:42.060 And again, Dorfman also rejected the few great men approach. 130 00:15:42.060 --> 00:15:54.060 includes all kinds of quote-unquote minor intellectuals and writers in shaping the direction of intellectual thought in early America as well. 131 00:15:54.060 --> 00:16:00.060 So we have the rejection of the few great men approach to the history of economic ideas. 132 00:16:00.060 --> 00:16:05.060 And this provided, I think, Rothbard the opportunity to expand the work of earlier historians. 133 00:16:05.060 --> 00:16:19.060 We felt a kinship to, as I said, some of these early writers like Grace Hutcherson and Noonan, and most especially Schumpeter, and dug around for information that wasn't in textbooks or available at the time. 134 00:16:19.060 --> 00:16:32.060 No longer would only a very few medieval philosophers like St. Thomas Aquinas appear in the early chapters of a standard textbook like Haney's textbook or John Fred Bell's textbook, 135 00:16:32.060 --> 00:16:37.340 book, but with the publication of Economic Thought before Adam Smith in 1995, readers 136 00:16:37.340 --> 00:16:45.860 have been treated with a comprehensive narrative in an engaging Dorfman style, so engaging 137 00:16:45.860 --> 00:16:51.180 and compelling, of more than 50 scholastics since the days of St. Anselm. 138 00:16:51.180 --> 00:16:55.720 Second, Rothbard's Economic Thought is a serious attempt to recapture the sense of 139 00:16:55.720 --> 00:17:00.040 historical continuity within the history of economic thought, most especially in portraying 140 00:17:00.040 --> 00:17:04.000 including the uniqueness and innovativeness of the scholastic writers. 141 00:17:04.000 --> 00:17:09.080 The history of the past, quote, adds depth to our understanding of the ideas that resulted 142 00:17:09.080 --> 00:17:11.880 from it all and which are still with us today. 143 00:17:11.880 --> 00:17:15.480 The history of economics can shed light on the history of ideas in general, and much 144 00:17:15.480 --> 00:17:20.280 that we can learn from that history about the dynamics of controversies and the emergence 145 00:17:20.280 --> 00:17:25.560 of paradigms applies to other fields and to our own times as well as to the past, end 146 00:17:25.560 --> 00:17:26.560 quote. 147 00:17:26.560 --> 00:17:32.080 a historical perspective in Rothbard's keen Austrian analysis of numerous scholastic writers 148 00:17:32.080 --> 00:17:36.280 that enriches our understanding of various policy questions today. 149 00:17:36.280 --> 00:17:41.300 For, quote, history necessarily means narrative, discussion of real persons as well as their 150 00:17:41.300 --> 00:17:48.420 abstract theories, says Rothbard, and includes triumphs, tragedies, and conflicts, conflicts 151 00:17:48.420 --> 00:17:52.600 which are often moral as well as purely theoretical, end quote. 152 00:17:52.600 --> 00:18:07.600 Finally, his work continues to inspire new attempts to explain and better understand the significance of the scholastic contributions to the overall development in the history of economic thought, ideas and concepts that are still with us today because they have enduring value. 153 00:18:07.600 --> 00:18:19.600 In the area of scholastic economic thought, Rothbard's work is the new gold standard, where alchemists are exposed and right reason is on full display. Thank you. 154 00:18:22.600 --> 00:18:24.600 Thank you very much.