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NOTE A Rothbardian Research Program in American History

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I'd like to start off by saying that the Austrian Scholars Conference has been a very fruitful

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outlet for me over the past ten years. I gave a paper here in 2002 that later turned into

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my book, The Church and the Market, in 2005. That actually ended up winning me a fairly

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substantial book prize which, as a matter of justice, I shared some of the proceeds

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from with the Mises Institute. I gave a paper on the military-industrial complex that turned

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I've turned into a chapter in my book Rollback. I answered a critic here once and that turned

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into an article in the Catholic Social Science Review. So it really makes me, my natural

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inclination is to be a lazy bum and then this conference comes along and it makes the lights

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of fire under me. So it's good to do that. Well, today my ambitions are at once less,

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I don't know, perhaps elevated and yet at the same time maybe in the long run even more

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are significant than otherwise because I want to sort of inspire other people to do things

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this time. And I want to talk in particular about something that Rothbard wrote years

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ago and my inspiration here comes from this collection that's edited by David Gordon called

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Strictly Confidential. It's the Volcker Fund memos that Rothbard wrote. Now the Volcker

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The Volcker Fund, of course a lot of you know, the William Volcker Fund, paid Mises' salary.

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It made possible the writing of Man Economy and State.

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It was a group of businessmen with some money, and they helped to fund what little libertarian

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scholarship was taking place at that time.

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Rothbard wrote a number of memos for them that are absolutely fantastic.

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I sort of thought, I'll be honest with you, when this book came out, I kind of thought,

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all right, now maybe they're just scraping the bottom of the barrel of the Rothbard papers.

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We all have this Rothbard fix that needs to be satisfied. We need a Rothbard book every

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two years. But I finally flipped through one day. I got a Kindle for the first time. I

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wanted to put stuff on it, so I figured I'd put this on.

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So I get to Rothbard's book review of a two-volume history of the American Republic by George

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de Houssard and Thomas Holbert Stevenson. And he lays into this book like you would not

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Believe, page after page and on a Kindle of course you don't know ahead of time how long

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a given chapter is and I finally said, how long does this go on? It goes on for over

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a hundred pages. So I want to start off just, really what I want you to do is if nothing

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else, just read this memo and you can get Strictly Confidential here in the bookstore,

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You can get it online for free in various formats. Look at this memo. It's unbelievable

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that Rothbard had this in his files for years and never thought maybe it might be worth

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publishing as a monograph because it is indirectly a recommendation of what you should do if

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you want to really tell the American story. So I want to just start off by, I want to

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read you just a passage almost at random to give you a hint of the flavor and verve of

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So, he says,

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Monroe was not handpicked by Madison. Contrary to de Houssard, there was a great deal of enmity there.

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Furthermore, de Houssard omits the crucial struggle between Monroe and William H. Crawford

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for the presidential succession in 1816. Monroe, a former deep-dyed Republican,

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now a bipartisan Federalist type, defeated Crawford, the candidate of the old Republican forces.

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Crawford was supposed then to succeed Monroe. This was the general agreement.

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In the Monroe administration such men as Adams and Clay had prominent roles and in 1824 Monroe

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took the crucial anti-Crawford step of refusing to name his successor and refusing even to

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uphold the old caucus system, where Crawford would have won renomination easily. Thus Monroe

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completed his final betrayal of the old cause. None of this penetrates to de Hussard, who

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hardly knows of Crawford's existence, much less of the principles and the cause that

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he represented.

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Now Rothbard was an economist by training. I hasten to remind you. He's recommending

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sources constantly to the objects of his scorn. So talking about colonial times, simply being

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told that many people could vote is too fuzzy and imprecise. There should be more use of

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recent voting studies, of which Rothbard recommends two. He says the ordinance of 1785 was a dictatorial

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Controversial intrusion into the western region, which set too high a minimum land sale and

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price thus restricting settlement, and also enforced rectangular surveying, thus forcing

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the purchase of sub-marginal land within an otherwise good rectangle, instead of conforming

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as in the southern methods of surveying to the natural topography of the land in question."

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I bet you overlooked that about the Ordinance of 1785.

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Duhuzar should consult, he apparently had some aside about the Magna Carta and it only

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applied to the Barons, wasn't very significant. He says, no, no, no, Duhuzar is too revisionist

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on the Magna Carta. He should consult the recent swing back to the high importance of

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the Magna Carta in such works as Faith Thompson and R.L. Perry. And then he goes on and says,

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now, okay, so it's bad enough we get insufficient mention of U.S. imperialism over Hawaii, but

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But there is no mention at all of the U.S. Samoan Treaty for a naval base in Samoa and

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its vicissitudes in the Senate in the 1870s, the U.S. joining the Madrid Convention in

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1880, the Berlin Game Treaty with China on immigration or its revision in 1880. There's

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nothing at all on the Freling-Heisen-Zavala Treaty of 1884. And it just goes on in this

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way and I mean there's just so much. So then he's talking about the 1920s and that period

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He says there is no mention whatsoever of the institution of the AMA quasi-monopoly

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over medical monopoly following the Flexner Report.

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There's nothing on Sacco and Vanzetti, there's no Scopes trial, there's no Holmes-Brandeis

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dissents and their legal philosophy, nothing on the Railway Labor Act, then he mentions

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Supreme Court cases, the Shepherd-Towner Act, the founding of the FBI, nothing.

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So it's just awesome to read this even if you don't want to pursue anything that he

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implicitly recommends you pursue.

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I just wanted to give you a flavor of this, of just how knowledgeable this guy is.

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I wrote to Lew Rockwell after I read this and I said, I feel like I know no US history at all

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after reading this memo.

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But my favorite thing is, he does somewhat criticize the ideological bias of the authors,

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but his real criticism is that they have no overall big picture understanding at all.

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at all. It's just a dry chronicling of events that seems to conform to the typical textbook

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retelling of the story. But he does pinpoint some, at least implicit, ideological commitments

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of the authors that he's unhappy with. But my favorite is he says, the authors appear

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to approve of the public library movement. He's zeroed in on how unsound they are. What's

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But also great though about this memo is not only that it's implicitly recommending all

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kinds of research projects. There are dissertation topics in here. I don't want to hear any more

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caterwalling about, I don't know what to write about. All right, then read this thing. You'll

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have plenty to keep you busy. But also he's implicitly recommending how history ought

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to be done. So for example, like Rothbard's overall view, the way he approaches history

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as he explains to us in the introduction to his four volume series Conceived in Liberty

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is liberty versus power. That's his overarching theme and that's how he sifts through the

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material. Now he doesn't say everybody has to do it this way, but this is a particularly

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fruitful path and has been for him because it means that he always expects the state

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to be getting away with something. So even the most apparently benign state actions,

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he's looking for what's really going on here. So for example, it's because of that

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Rothbard looks at the civil service reform movement of the late 19th century, later 19th

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century that you would think is not really of that much interest. But Rothbard immediately

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realized this is a rotten movement because instead of the, he loved the wonderful old

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system that they smeared as the spoil system where the victor would come in and fire everybody

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and replace them with his cronies. Okay, that's great because we get rid of all the, we don't

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let these people get entrenched, we clear them out, we replace them with other dead

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Beats, and that's the best we're going to do in this situation, where civil service

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reform freezes these people in place.

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You can't just fire them.

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So Rothbard says, so notice what the consequences of the Pendleton Act of 1883 are going to

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be.

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The consequences are it's not like all of a sudden now nobody's going to have cronies

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anymore, just that now you can't get rid of the old cronies, so if you're going to reward

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your cronies, you have to come up with new jobs for them.

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So now there's going to be a ratchet effect upward in government employment.

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You can't clear out the other ones and replace them, you've got to add new ones.

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So if you weren't constantly looking for what are these people doing, how are they encouraging

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the growth of government?

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You might have missed that.

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But what he recommends, first of all, is don't just thoughtlessly accept the officially given

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rationale for something.

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Ask the question, who lobbied for this thing?

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So he's not saying, by the way, that any environmental regulation or consumer product regulation

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is necessarily always and exclusively a cartilaging device by existing competitors to keep other

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people down, although it may well be that to some people.

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It's also the case, people do, there are consumer advocates who do advocate these things

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for what they consider to be pure motives.

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There are environmentalists who do purely recommend environmental regulation, but it's

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the old Bruce Yandel bootleggers and Baptists thesis that the bootleggers and the Baptists

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were both in favor of prohibition, but not for the same reasons.

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Well likewise here, Rothbard wants to know, how come when talking about the conservation

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movement, which he barely covers, we get the author, we get no mention of the economic

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interests pushing for it? If you withhold some land, if you give it to the U.S. government,

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that increases the land prices of the remaining lands. Obviously there are people who are

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going to lobby for this. He doesn't mention Jay Cooke's maneuvering to enact a national

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Bank Act, so as to provide a guaranteed bank market for Cook's government bonds.

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He says that de Huizar is biased in favor of interventions in Latin America to protect

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American investments, but he never points out who these investors were and what kind

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of pressure, what forms of pressure they put on the U.S. government.

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He also says that the munitions makers need to come under scrutiny.

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Don't just give me all people, American citizens favored preparedness.

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Well, which citizens, Rothbard says. He says that de Houssard says the National Security

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League around the time of World War I consisted mainly of private citizens wanting to strengthen

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the armed forces of the United States. Yes, indeed, but which private citizens, Rothbard

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says, the munitions makers who reaped contracts from big arms budgets. And then he recommends,

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he says, read the speech in Congress by Representative Clyde Taverner in 1915 on the economic interests

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is represented in the Navy League. So he's dug that up somehow. Then he reminds us historians

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know almost no economics. So they fall prey to whatever the reigning orthodoxies happen

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to be. So if the orthodoxy is that the gold standard causes depressions, that's what they

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go for. They have no basis for knowing any better. So I wrote an article for the Quarterly

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Journal some years ago on what Austrian economics can teach historians and why we've got a certain

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Leg Up. So this particular author accepts every welfare state expansion at face value. He

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never connects depressions, or hardly ever, with preceding credit expansion. His farm

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policy biases are annoying. He says that two of the causes of the Great Depression were

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overproduction and the depression among farmers, which reduced their purchasing powers, a typical

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He even defends wildcat banking as leading to increased growth and prosperity, and thereby as Rothbard says, unwittingly adopting the most egregious fallacies of the present day Keynesians.

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And then finally, war propaganda. Now war propaganda is where the historian has really got to aim that laser beam.

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Because it's just always phony, and it's very bad for scholars to fall for. In fact, after World War I, we all know the League of Nations was formed,

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of Nations was formed, but lesser known is that the Committee on Intellectual Cooperation of the League of Nations was formed.

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That was formed with the idea that intellectuals ought to be above all this nationalistic bickering,

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and ought to be above some of the crude propaganda, portraying the Germans as barbarians and all that.

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We're intellectuals, we're men of reason, we ought to be above this.

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And the idea of that committee was to prevent that sort of nationalistic parochialism from occurring again.

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and for the same sort of reason we want to re-evaluate war propaganda and Rothbard is

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very skeptical of course of all the given rationales for the various U.S. wars so he goes through

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them all.

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The Mexican War, he remembers that the 1819 Adams-Onise Treaty had said that the southern

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boundary of Texas is the Nueces River and then after the U.S. got Texas then it just

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threw that treaty out the window and said no, no, no, from now on we're going to say

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that it's the Rio Grande.

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And then, well, that was the whole dispute, was precisely over that.

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And so he gives a very good overview of all this stuff.

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But then talking about the Spanish-American War, like we all know that, you know, the

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Maine and a lot of the propaganda there.

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And he goes through and eviscerates all this stuff in great detail.

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But then he'll just ask questions that you never even thought of before, like the DeLome

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letter in which the Spanish minister to the U.S. insulted McKinley and this contributed

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to some of the war fever.

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Rothbard reminds us, of course, that the New York Journal that published this

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stole the DeLomme letter from the post office. Why were they never prosecuted for that?

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I mean, just good questions, right? Why do people not ask?

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And then finally, because I know I just got the one-minute sign, I think the most urgent task

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right now

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for Rothbardians who are doing history is to go back and look again at the 19th

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century panics

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because now that we're really got the Fed right where we want it,

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they're coming back with, oh, but the 19th century was terrible, you had booms and

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and you certainly don't want to go back to that. Now Rothbard already gave us a great

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work on the Panic of 1819 but there's a lot more where that came from and we need to see

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more work done on that and at the Mises Institute last year I gave almost an hour talk on this

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subject on economic cycles before the Fed and I made up a resource page on my website

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with some of the sources we do have in the Austrian tradition right now on these topics

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along with my own video and that's at tomwoods.com slash panics

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I'm out of time but

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look at this thing and don't ever complain you have nothing to do again

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alright thank you