WEBVTT NOTE The Future of Austrian Economics 1 00:00:00.000 --> 00:00:30.000 In order to, but since the last, the first Mises University was last summer about this time and since the, since that, since that event, we've had a, we've gone through cataclysmic changes in the world and the, what we've seen I think in this last part of last year and continuing this year is the most exciting event in the 20th century, certainly in my lifetime I think in the 20th century, namely the total revolutionary collapse of socialism dash communism. 2 00:00:30.000 --> 00:00:54.000 And it was just fantastic, and that's part of the case for optimism about the future, excuse me, is the fact that something happened which nobody predicted would happen in any sort, at least at that time, in that sort of way, is that we had a totalitarian monolith. 3 00:00:54.000 --> 00:00:59.760 One friend of mine claimed about two, three years ago that communism has succeeded in 4 00:00:59.760 --> 00:01:02.640 brainwashing all the people, all their subjects. 5 00:01:02.640 --> 00:01:07.040 They created a new socialist man, the man that they were trying to achieve, and therefore 6 00:01:07.040 --> 00:01:09.040 everything was hopeless. 7 00:01:09.040 --> 00:01:14.040 And typical of this person is he's not exactly a very good prophet. 8 00:01:14.040 --> 00:01:19.960 And shortly after his article was written came the beginnings of the whole collapse 9 00:01:19.960 --> 00:01:21.840 of communism. 10 00:01:21.840 --> 00:01:26.340 And one of the great things about it, in addition to the fact that it shows that the spirit 11 00:01:26.340 --> 00:01:32.740 of freedom cannot be wiped out in mankind, is that it shows the power of ideas. 12 00:01:32.740 --> 00:01:33.740 It's very difficult. 13 00:01:33.740 --> 00:01:35.220 We tend to get pessimistic sometimes. 14 00:01:35.220 --> 00:01:42.120 Some people do, some laggards, some of the faint of heart, because here we're pouring 15 00:01:42.120 --> 00:01:45.840 forth ideas, and Mises, for example, I'll get to that in a minute, that all his life 16 00:01:45.840 --> 00:01:50.700 was fighting for freedom and opposed to tyranny and socialism. 17 00:01:50.700 --> 00:01:56.700 And you think, well, how can ideas affect history? And we're locked in, you know, we 18 00:01:56.700 --> 00:02:02.460 only know about the public choice trap. The public choicers who tend to be free market 19 00:02:02.460 --> 00:02:09.460 people are trapped in this extremely gloomy pessimistic world outlook. Namely that special 20 00:02:09.460 --> 00:02:16.540 privileges, of course, as we all know, special privileges out shaft us 24 hours a day. They're 21 00:02:16.540 --> 00:02:46.540 constantly working for lobbying and special privileges and monopoly contracts and all that and the rest of us, the consumers, the average person, is not interested in any one particular focus like the sugar market or the grain market or whatever, 24 hours a day and therefore the consumer is, quote, rationally ignorant, and uncaring about these particular fields and areas and therefore it's inevitable the special privileges always went out and tyranny and statism went out and that's it. There's no hope. 22 00:02:46.540 --> 00:02:53.540 And every person, since every person is only interested in the narrow, short-run economic interests, there's no way of getting out of this trap. 23 00:02:53.540 --> 00:03:00.540 George Stiegler, for example, the distinguished dean of Chicago School of Economics, one of the two deans at least, 24 00:03:00.540 --> 00:03:04.540 the view is that ideas have no influence on history whatsoever. 25 00:03:04.540 --> 00:03:09.540 It's as if everybody's writing in sort of a vacuum or writing for each other, other professors. 26 00:03:09.540 --> 00:03:15.540 And there's no point to any of this as far as affecting history goes. 27 00:03:15.540 --> 00:03:19.540 And coming from the story of economic thought is kind of a depressing picture. 28 00:03:19.540 --> 00:03:23.540 So why are you doing all this if none of this has any impact? 29 00:03:23.540 --> 00:03:28.540 So what we find out here, a dramatic example of the exact opposite. 30 00:03:28.540 --> 00:03:35.540 In other words, here is the communist system, totally locked in, an alleged monolith, 31 00:03:35.540 --> 00:03:42.540 special privileges of nomenclatura, totally dominant, everybody had to work for the state, 32 00:03:42.540 --> 00:03:47.140 of the State, everybody's lives were organized by the state and commanded by the state, and 33 00:03:47.140 --> 00:03:49.240 therefore it seemed to be no hope. 34 00:03:49.240 --> 00:03:54.540 And obviously something, and here's a situation with people like Ludwig von Mises, for example, 35 00:03:54.540 --> 00:04:00.220 Etienne Labollet, T. David Yuma, Ludwig von Mises, always kept insisting that in the long 36 00:04:00.220 --> 00:04:04.580 run ideas are the things that count, it's not short run economic interests, it's the 37 00:04:04.580 --> 00:04:21.580 The ideas held by the public that determine historical events, that no government, however much force they command, however much instruments of terror they use on the population, no government can last any length of time unless the public supports it. 38 00:04:21.580 --> 00:04:24.580 The majority of the public endorse it, one way or the other, for whatever reason. 39 00:04:24.580 --> 00:04:33.580 And this seemed to be outmoded in the days of totalitarianism, the days when the government has all these red instruments of torture and high technology at their command. 40 00:04:33.580 --> 00:04:40.580 How can the average person resist this? And, you know, we've all read Orwell's 1984, of course, it's a very gloomy picture. 41 00:04:40.580 --> 00:04:45.580 Everything is shot, everything is finished. The totalitarian elite will win out. 42 00:04:45.580 --> 00:04:46.580 will win out. 43 00:04:46.580 --> 00:04:52.060 And then at the beginning of all this process, Ludwig von Mises in 1920 wrote his famous 44 00:04:52.060 --> 00:04:58.860 article on economic calculation of socialist commonwealth, the beginning of this whole 45 00:04:58.860 --> 00:05:03.780 monstrous collectivist process in the 20th century, and he said, it's not going to work. 46 00:05:03.780 --> 00:05:08.900 In other words, in addition to the moral ideas, the moral failures of socialism and all the 47 00:05:08.900 --> 00:05:14.580 other political, philosophical failures and sociological failures, it ain't going to work. 48 00:05:14.580 --> 00:05:21.580 Impossible, as he put it, and cannot plan a modern industrial system. It's going to fall apart. It can't calculate. 49 00:05:21.580 --> 00:05:29.580 And this was allegedly rebutted. The socialists, by the way, in those days took this very seriously. 50 00:05:29.580 --> 00:05:34.580 This was the first time that they'd come to their attention as a problem other than the incentive problem. 51 00:05:34.580 --> 00:05:39.580 You know about the incentive problem. Everybody acknowledged that from the very beginning of socialism, even before socialism. 52 00:05:39.580 --> 00:05:43.860 The Great Socialist Experiment of the Soviet Union was established. 53 00:05:43.860 --> 00:05:49.620 The center problem is if everybody is equal and if everybody takes according to his needs and gives according to his ability, 54 00:05:49.620 --> 00:05:55.500 who's going to take out the garbage? Who's going to do the dirty work? What's going to happen? 55 00:05:55.500 --> 00:05:59.580 And the answer, basically, if you think of the socialists, was we will create, 56 00:05:59.580 --> 00:06:04.820 socialism will create a new socialist man, which will be cheerful and robotic 57 00:06:04.820 --> 00:06:08.140 and dedicating his whole life to the service of the state apparatus. 58 00:06:08.140 --> 00:06:14.380 And essentially Mises said, look, even setting out aside whether or not you can do that, 59 00:06:14.380 --> 00:06:20.380 even having a bunch of robots which are shiffly rushing to obey the commands of the state, 60 00:06:20.380 --> 00:06:23.540 what will the state be able to tell them? What will the state tell them to do? 61 00:06:23.540 --> 00:06:28.140 How will they be able to plan and calculate where some production should be established, 62 00:06:28.140 --> 00:06:33.180 and what processes should be used, and what combinations, and so forth? 63 00:06:33.180 --> 00:06:36.500 And he said they can't do it because there's no free market on the means of production. 64 00:06:36.500 --> 00:06:44.500 There's no genuine market which establishes a genuine price system, and therefore they won't know their cost, they won't know if they're doing well or badly, and the whole thing will fall apart. 65 00:06:44.500 --> 00:06:55.500 The socialists taking this very seriously try to refute it. We had about 20 years or 15 years of debate back and forth, especially in Europe where Mises, of course, was published. 66 00:06:55.500 --> 00:07:06.500 The conclusion, which was accepted by every right thinking economist by the late thirties, was that's okay, we can have a market socialism, make them total managers to play, play market, so forth and so on. 67 00:07:06.500 --> 00:07:20.500 This was generally accepted by the establishment. And everybody sat back, well that, phew, that problem was disposed of, they don't have to worry anymore, socialism is okay, we just have this artificial market, so-called market. 68 00:07:20.500 --> 00:07:27.220 And Mises kept refuted that and Human Action, but the economic establishment, so to speak, 69 00:07:27.220 --> 00:07:30.980 determines that the whole problem was over, don't worry about it, socialism can do it. 70 00:07:30.980 --> 00:07:35.540 Well, here we are, and by the end, one of his last articles in his life, Oscar Longa, 71 00:07:37.140 --> 00:07:42.260 a monstrous little article called The Computer and the Market, really refuted his whole approach. 72 00:07:42.260 --> 00:07:45.300 He had said in his economic theory of socialism, we don't have to worry, 73 00:07:45.300 --> 00:07:49.780 socialism doesn't have to worry about calculation, we just have a phony market, we have trial and error. 74 00:07:50.500 --> 00:08:20.500 and we can do it very easily and then he's in 1963 just before 65 I guess just before he died he said we don't have to worry now if I was writing my answer to Mises and Hayek today I'd simply say look we have a computer, a great new institution, a great new mechanism which will plan everything in two seconds and the effect is better than the market and I don't have to worry about it and then he passed on. At any rate we now find in Eastern Europe and Soviet Union 75 00:08:20.500 --> 00:08:28.500 fantastic demonstration of vindication of Mises' whole approach. The whole thing collapsed. It turns out socialism is indeed impossible. 76 00:08:28.500 --> 00:08:43.500 And popping up from this rubble, we find a whole enormous, unbelievable to all of us, enormous outcropping and outpouring of Misesians and Hayekians all over Eastern Europe and the Soviet Union. 77 00:08:43.500 --> 00:08:51.500 And one of the physical embodiments of that, of course, was here this week, the wonderful Yuri Maltsev, I'm sure you've all met. 78 00:08:51.500 --> 00:09:00.500 And here he is, he's now honored in the Soviet Union as a prophet, and they want him back, come back and help us plan and so forth. 79 00:09:00.500 --> 00:09:09.500 Of course, Yuri's too shrewd for that. 80 00:09:09.500 --> 00:09:31.500 One of the most moving examples of both the Mises Institute and this unbelievable desocialization occurred this spring, April or May, when the Mises Institute put on a desocialization conference in Washington and it was like a people's international. 81 00:09:31.500 --> 00:09:37.500 We had a discussion of socialist planning in Eastern Europe. 82 00:09:37.500 --> 00:09:42.500 Yuri talked about the Soviet Union and Hans Hoppe talked about Germany. 83 00:09:42.500 --> 00:09:51.500 And we had a great guy who was a Polish-American, emigrated from Poland in the early 80s, talking about the Polish planning. 84 00:09:51.500 --> 00:09:58.500 And we also had a top economist from Lithuania. 85 00:09:58.500 --> 00:10:06.500 This is very moving, one of the most moving experiences I've ever had, because everybody thought the Russian tax would be moving in in about, you know, any day. 86 00:10:06.500 --> 00:10:13.500 And we had a Lithuanian economic delegation, not worried, seemingly not worried about the tax at all. What they want to do, how do you privatize? 87 00:10:13.500 --> 00:10:17.500 How do you get to total privatization, total free market? How do you do it? Interesting question. 88 00:10:17.500 --> 00:10:23.500 It's a question, of course, that orthodox economists have never thought about, because they never thought it would happen. 89 00:10:23.500 --> 00:10:41.500 and all these millions of dollars that have been poured into anti-communist think tanks over the last 40 years, 45 years or so, figuring out about missile weights and throw weights and who should bomb who's missile first and where and so forth. 90 00:10:41.500 --> 00:10:50.500 The whole thing seems to be, right now you're looking back at it, it seems to be like a 16, looking back at the 16th century and the whole world has changed in one year. 91 00:10:50.500 --> 00:10:55.500 And the whole Thruway thing looks like a fantastic waste of resources poured into this stuff. 92 00:10:55.500 --> 00:11:02.500 And in the midst of all this anti-communist research, nobody, as far as I know, none of these think tanks, 93 00:11:02.500 --> 00:11:07.500 none of these anti-communist foundations or whatever, nobody ever sat down and thought, 94 00:11:07.500 --> 00:11:12.500 well, what would happen if the Russians suddenly read Human Action or read Milton Friedman or something 95 00:11:12.500 --> 00:11:17.500 and came to Western economists and said, okay, here's the key, do something about it, we surrender. 96 00:11:17.500 --> 00:11:23.500 Right? Communism is finished. What do we do next? And none of these guys ever thought about it. 97 00:11:23.500 --> 00:11:27.500 Because for one thing they thought, they never absorbed the lesson of Ludwig von Mises. 98 00:11:27.500 --> 00:11:30.500 They never absorbed the fact that socialism can't work. Eventually it is going to collapse. 99 00:11:30.500 --> 00:11:35.500 Eventually they are going to surrender one way or the other. They're going to ask, what are we going to do? 100 00:11:35.500 --> 00:11:40.500 And they had no answer for it after 45 years of anti-communist scholarship. 101 00:11:40.500 --> 00:11:52.500 And, well, what happened, the Lithuania economist, a whole delegation, I think, headed by vice premier, they were going around the United States, the East Coast, trying to find out, what do we do? 102 00:11:52.500 --> 00:12:03.500 And other think tanks, I might add, what they did was they showed them the great offices, the walkie-talkies and the plush carpets. 103 00:12:03.500 --> 00:12:06.500 They were, of course, very impressed with Lithuania, but they weren't interested in knowledge. 104 00:12:06.500 --> 00:12:11.500 knowledge. They knew that the West was a great technological shape. How did we apply that 105 00:12:11.500 --> 00:12:12.500 here? 106 00:12:12.500 --> 00:12:19.380 And only the Mises Institute, a great ideological entrepreneurship of Jeff Tucker, immediately 107 00:12:19.380 --> 00:12:24.100 whipped together an impromptu one-day conference of a whole bunch of economists lecturing to 108 00:12:24.100 --> 00:12:30.020 these Lithuanians on different economic topics. And they loved it. This is knowledge. This 109 00:12:30.020 --> 00:12:34.780 is what we came for. We didn't come to admire plush offices. We knew all about that. 110 00:12:34.780 --> 00:13:04.780 When I was at this Mises Institute conference a few weeks later, the first delegation, I'd say it was one of the most moving experiences in my life because all these people talked about the different aspects of Eastern Europe and the Lithuanian gentleman who thought he couldn't speak English well enough, obviously he did, but he was hesitant about speaking English to the group, he spoke in Russian and Yuri stood next to him translating into English. Marvelous, because he was the Lithuanian-Russian people's pre-market solidarity. 111 00:13:04.780 --> 00:13:17.780 while soviet tanks were threatening to march in, and one thing a Lithuanian economist said, he said, 112 00:13:17.780 --> 00:13:23.780 well, it was a wonderful thing over here today because Professor Samuelson at MIT told us we should have a central bank. 113 00:13:23.780 --> 00:13:28.780 The first thing we should do is establish a central bank in Lithuania, and we did that. 114 00:13:28.780 --> 00:13:31.780 Now we find out today we should repeal the central bank. 115 00:13:31.780 --> 00:13:59.780 So, he's a beautiful example of an influence of ideas on history, and he said that one thing I should say is that the, I was going to remark before, that the whole implosion, the whole revolutionary implosion in Eastern Europe showed us that we were going to do it, that we were going to do it, that we were going to do it. 116 00:13:59.780 --> 00:14:06.780 in Eastern Europe shows the powerful influence of ideas, because they simply said, we ain't very much to you, we're not going to obey orders anymore. 117 00:14:06.780 --> 00:14:12.780 It was like non-violent mass civil disobedience on a fantastic scale. 118 00:14:12.780 --> 00:14:20.780 And so here we have, as I say, nobody could predict the exact form of this, but here it was like a domino effect. 119 00:14:20.780 --> 00:14:25.780 One country topples, communism topples, and the rest of them topple. 120 00:14:25.780 --> 00:14:32.740 The, and the form it took was once it's, well for example in Romania it was a dramatic example 121 00:14:32.740 --> 00:14:37.860 because the troops were shooting in, the Ceausescu troops were shooting into the square and these 122 00:14:37.860 --> 00:14:41.620 people, they didn't flee, they just stood there and they said, you know, the heck with it, we'd rather 123 00:14:41.620 --> 00:14:46.020 dive and live under communism anymore and that was it. At that point the soldiers turned their 124 00:14:46.020 --> 00:14:50.900 guns on the officers and the whole thing and we had a point where Ceausescu issued orders and 125 00:14:50.900 --> 00:15:03.900 This is the great libertarian's dream, that the guys on the top ordering and butchering millions of people, all of a sudden they issue orders and everybody says, nuts to you. 126 00:15:03.900 --> 00:15:10.900 We ain't listening no more. It's impossible, I think, not to be optimistic when we see this. 127 00:15:10.900 --> 00:15:17.900 We have a lot of things to gripe about here. We have a lot of monstrous trends at work in the United States. 128 00:15:17.900 --> 00:15:30.900 When we see what happened with the undertotalitarianism, when people just said, how about that, we quit, and they're looking for free market solutions, and the Misesians, Hayekians popping up, it's a magnificent experience. 129 00:15:30.900 --> 00:15:39.900 It's something we should never forget. If we ever tend to be pessimistic about trends in the United States, we should realize what happened in Eastern Europe in 1989, 1990. 130 00:15:39.900 --> 00:15:44.700 So, in looking at this, and looking at the victory of freedom in Eastern Europe, I'm 131 00:15:44.700 --> 00:15:48.900 not saying all problems are solved, this is an unbelievable and fantastic thing which you 132 00:15:48.900 --> 00:15:53.820 should always remember, ideas in the long run can trump interests, can trump economic 133 00:15:53.820 --> 00:15:58.420 interests. 134 00:15:58.420 --> 00:16:04.940 Looking back at Mises being the originator of this, of the knowledge that socialism is 135 00:16:04.940 --> 00:16:16.940 I think we should look back on Mises' life and what happened in the events in Austrian economics to see, to gauge the future. We have to look at what's been happening in the recent, immediate past. 136 00:16:16.940 --> 00:16:33.940 As I said, after collectivism was being established, socialism was being established in the world, in Europe, Mises wrote this article. In addition to that, he was discriminated against. He couldn't get a university post, an Austria-paid university post. 137 00:16:33.940 --> 00:16:39.940 He got an unpaid post, prestigious but unpaid which meant of course he had to find work elsewhere 138 00:16:39.940 --> 00:16:49.940 largely because he was opposed to socialism and collectivism and there were only two kinds of economists or social scientists who received paid university posts in Austria at the time 139 00:16:49.940 --> 00:16:54.940 either Marxists or fascists or corporatists, that's it, they were the only respectable 140 00:16:54.940 --> 00:16:57.940 That was the wave of the future 141 00:16:57.940 --> 00:17:08.940 And the laissez-faire was reactionary, neanderthal, and part of the 19th century, which was being displaced by the great progressive new century, the 20th century. 142 00:17:08.940 --> 00:17:15.940 So in addition to that, the second thing which disqualified Mises from a paid university post was that he was uncompromising. 143 00:17:15.940 --> 00:17:20.940 He was a great guy. I mean, he's sometimes been accused of being personally abrasive. I never saw it. 144 00:17:20.940 --> 00:17:24.940 Those of us who studied under him in the United States. 145 00:17:24.940 --> 00:17:40.940 He was unbelievably sweet. He was constantly urging people, finding research projects for people to do, which he usually didn't do, of course, but always coming up with ideas and always being unfailingly courteous and unfailingly and non-bitter about what had happened to him. 146 00:17:40.940 --> 00:17:53.940 And so here he was, but he refused to compromise one iota. In other words, he didn't bend with the wind, with intellectual winds, which all too often happens in the world, we all know. 147 00:17:53.940 --> 00:18:04.940 He didn't say, well, let's try to work within the system and say, stateism is okay, but you should have a little bit of tinkering here and there, like a little currency reform or a little wage reform or something like that. 148 00:18:04.940 --> 00:18:10.940 He was absolutely uncompromising and kept developing his ideas and his great works. 149 00:18:10.940 --> 00:18:17.940 And in the meantime, not having a paid university post, he had a full-time post as economist, chief economist for the Chamber of Commerce, 150 00:18:17.940 --> 00:18:23.380 for Commerce, which in Austria was a quasi, a government agency, which where businessmen 151 00:18:23.380 --> 00:18:29.380 elected representatives of this chamber and they would have a staff and they would advise 152 00:18:29.380 --> 00:18:30.380 the government. 153 00:18:30.380 --> 00:18:35.260 But as a result, Mises became the major economic advisor, although his advice wasn't listened 154 00:18:35.260 --> 00:18:36.260 to very much. 155 00:18:36.260 --> 00:18:38.100 He was tremendously respected. 156 00:18:38.100 --> 00:18:43.380 So he almost single-handed, he and a couple of friends of his were essentially single-handedly 157 00:18:43.380 --> 00:18:57.380 He stopped the Austrian inflation, which is rampant, as well as the German after World War I, stopped it from a runaway inflation, he stopped it at about 1200% or whatever, instead of becoming, as in Germany, one quadrillion marks to the dollar. 158 00:18:57.380 --> 00:19:03.380 It was only 1200 Austrian shillings or whatever, fennel eggs, whatever the currency unit was to the dollar. 159 00:19:03.380 --> 00:19:25.380 Later in his memoirs, which was written in the midst of his flight from Europe in 1940, he said, now he's looking back on it, he wishes that he hadn't fought it, because it was hopeless in the long run anyway, because it just lengthened the time of the inflation, just slowed it down, and the result was the banking crash and collapse in 1931. 160 00:19:25.380 --> 00:19:55.380 But, as a matter of fact, one of the very sweetest things, one of the most charming and moving passages in this book, he said he's always been accused of being too uncompromising. If only he had waffled, he might have been more influential. And looking back on it, he said, no, no, I wasn't hardcore enough. I wasn't uncompromising enough. Looking back on it, I should have been tougher. The Council of the United States is a refugee. Again, it gets no paid academic post in the United States, despite its tremendous creativity and unbelievable every addition. 161 00:19:55.380 --> 00:20:10.380 At a time when every Marxist, semi-Marxist, social-democrat, Menshevik, Trotskyite, whatever, Bukharinite refugee got top academic posts, were fed and welcomed at top universities. 162 00:20:10.380 --> 00:20:22.380 Fortunately at that time we had, well he got a small foundation grant in New York, penniless, small foundation grant to work on two great books which came out a couple of years. 163 00:20:22.380 --> 00:20:26.380 Mises is by the way the sort of person that got a grant in the two years there was a book 164 00:20:26.380 --> 00:20:30.380 and something many of us try to emulate 165 00:20:30.380 --> 00:20:34.380 and two great books, bureaucracy 166 00:20:34.380 --> 00:20:38.380 still a magnificent book explaining the difference between working as a profit 167 00:20:38.380 --> 00:20:42.380 operation, private profit and loss operation 168 00:20:42.380 --> 00:20:46.380 and government operation, which has to be bureaucratic as he said, and non-profit 169 00:20:46.380 --> 00:20:50.380 organization. I'll get back to that in a minute because there's a whole 170 00:20:50.380 --> 00:20:57.180 The whole uncharted area, which Austrian economists haven't dealt with and nobody else has dealt with, really, is of the economics of non-profit organizations. 171 00:20:57.180 --> 00:21:03.380 How do they work? Is it possible for them to be efficient? And Mises pioneered in that. 172 00:21:03.380 --> 00:21:10.380 And also his book Omnipotent Government, which at the time was extremely important and influential because he was the first one to show, 173 00:21:10.380 --> 00:21:20.180 in those days the ruling doctrine here, promulgated by a Marxist refugee from Europe, Germany, was that Nazism was simply the last final stage 174 00:21:20.180 --> 00:21:25.460 of Evil Capitalism. The capitalists turned to the Nazis to crush the rising proletariat. 175 00:21:25.460 --> 00:21:30.740 And that's the basic explanation of Nazism. And what Mises pointed out was, this is ridiculous, 176 00:21:30.740 --> 00:21:34.540 what Nazism really is, is national socialism. It's a form of socialism and collectivism 177 00:21:34.540 --> 00:21:42.940 in the German nation. After that, it was really adrift. And what happened was there was a 178 00:21:42.940 --> 00:21:47.580 small group of, there was a foundation, a small group of conservative and libertarian 179 00:21:47.580 --> 00:21:54.580 and Business Men, who banded together, and actually the William Volcker Fund, which is the head of this, 180 00:21:54.580 --> 00:22:00.880 William Volcker Fund is an unsung forgotten institution, which really was like the candle in the catacombs or whatever, 181 00:22:00.880 --> 00:22:10.780 it preserved, maintained and fostered, all during the 1950s and early 60s, late 40s and early 60s, libertarian and conservative scholars. 182 00:22:10.780 --> 00:22:17.080 That was a period after realizing there ain't no such thing as free market economists or social scientists or anything. 183 00:22:17.080 --> 00:22:25.080 Everybody was either, in the ruling fashion, was either a communist or communist fellow traveler or you're a social democrat. That's it. That was the only, that was the range of debate. 184 00:22:25.080 --> 00:22:33.080 Are you a social democrat or are you a commie? Being a free market person was being some sort of 19th century reactionary fascist neanderthal. 185 00:22:33.080 --> 00:22:46.080 So, Harold Luna, the head of the Volcker Fund, was searching around for, his first task he felt was to find a paid university post in the United States for Mises and Hayek. 186 00:22:46.080 --> 00:22:59.080 Hayek was in England. Hayek had posts in England. Mises had no position at all. The result of which, of this detailed search, was he couldn't find a paid university post for either of them, interestingly enough. 187 00:22:59.080 --> 00:23:12.080 And, in other words, this replicates Mises' experience in Austria in us. And Mises, the best he could do for Hayek was the University of Chicago economics department rejected Hayek as being reactionary in the end, or whatever. 188 00:23:12.080 --> 00:23:25.080 I don't remember, but they found an unpaid post form in the Committee of Social Thought in Chicago, which is a highly prestigious graduate department, but the problem with that is, if you graduate with a PhD in social thought, where do you teach? 189 00:23:25.080 --> 00:23:38.080 There are no departments of social thought in any place. So it's very difficult to get a teaching position, do anything with it. Usually they're not about history departments, but it's kind of difficult, you're not certified historian, 190 00:23:38.080 --> 00:23:43.080 which as we all know is very difficult in any field to break through the crust. 191 00:23:43.080 --> 00:23:48.080 So, but Hayek has an unpaid post. In other words, the Volcker Fund paid for his salary, Hayek's salary, and Mises, 192 00:23:48.080 --> 00:23:54.080 the Volcker Fund paid for his salary as a visiting professor at NYU and the Graduate School Business Administration. 193 00:23:54.080 --> 00:24:03.080 But the major influence that Mises had was a private seminar which he gave every week in the Department of Commerce offices, 194 00:24:03.080 --> 00:24:08.280 Office, Chamber of Commerce Offices, and was a magnet for all the top students in Europe, 195 00:24:08.280 --> 00:24:12.640 all the top young social scientists and economists and philosophers in Europe, and even the United 196 00:24:12.640 --> 00:24:18.040 States and England, came to this because this was a great center of research from the early 197 00:24:18.040 --> 00:24:21.360 1920s until 1934. 198 00:24:21.360 --> 00:24:25.600 And he tried to replicate this with us in the United States, and unfortunately, I felt 199 00:24:25.600 --> 00:24:30.640 very sorry about it because the caliber of the students there was not exactly up to Vienna 200 00:24:30.640 --> 00:24:40.640 Paul, put it very kindly, he was totally uncomplaining. He was pressed on and did his very best to stimulate, as I said, research in students. 201 00:24:40.640 --> 00:24:52.640 And this was a period from 19, when he was here from the mid-40s until he died in 1973, it was sort of like, as I said, a candle in the darkness. 202 00:24:52.640 --> 00:24:58.640 There were very few Austrians, very few free market people, even when the free market became more respectable, there were almost no Austrians. 203 00:24:58.640 --> 00:25:06.640 and he pressed on extraordinarily productive and extraordinarily cheerful in this whole process. 204 00:25:06.640 --> 00:25:20.640 When he died in 1973, just coincidentally, the next year, that was the year 7374 of the great collapse of Keynesianism 205 00:25:20.640 --> 00:25:29.640 of Keynesianism, because that was the first year when the process of so-called stagflation or inflationary recession became evident. 206 00:25:29.640 --> 00:25:39.640 It happened before a little bit, but it wasn't evident. All of a sudden, 73, 74 is an inflation, 13, 14% inflation, so-called double-digit inflation. 207 00:25:39.640 --> 00:25:45.640 And at the same time, it was a big recession with unemployment and bankruptcy and all the rest of it. What are you supposed to do about this? 208 00:25:45.640 --> 00:25:52.640 Keynesian doctrine, of course, is very simple. I mean, the equations are complicated, but the practical conclusion is very simple. 209 00:25:54.000 --> 00:26:01.560 The government is the great macro-steering wheel, whatever. The economic system is wonderful in the micro sense, but in the macro sense it's totally 210 00:26:01.560 --> 00:26:06.240 without an anchor, without a rudder. It needs a great helmsman, namely, of course, the government, 211 00:26:06.240 --> 00:26:10.780 provided the government is steered by Keynesian economists. That's, of course, a key. 212 00:26:10.780 --> 00:26:15.940 And looking at the controls and the indicators and statistics, if the Keynesian economist 213 00:26:15.940 --> 00:26:20.580 finds that there's a recession and prices are falling and all that, you pump in spending, 214 00:26:20.580 --> 00:26:24.780 usually of course meaning increasing government budgets. 215 00:26:24.780 --> 00:26:29.500 If you find there's a boom and there's prices going up and so forth and inflation, then 216 00:26:29.500 --> 00:26:34.340 you take out spending, almost always of course by increasing taxes, never by cutting the 217 00:26:34.340 --> 00:26:38.980 government budget, by the way, this is part of the Orwellian memory hole of the original 218 00:26:38.980 --> 00:26:43.980 and Keynesianism. So you increase taxes by sopping up, quote, excess purchasing power. 219 00:26:43.980 --> 00:26:47.980 In other words, we have the excess purchasing power after the government has already inflated the money supply. 220 00:26:47.980 --> 00:26:52.980 We've all gotten it. Then we become excessive and they have to sop it away again. 221 00:26:52.980 --> 00:26:56.980 There's sort of a one-two punch to the economy, to the people. 222 00:26:56.980 --> 00:27:01.980 So here we have a situation, however, where two things are happening at once. 223 00:27:01.980 --> 00:27:05.980 Inflation, prices are going up, and yet there's also recession. What are you supposed to do? 224 00:27:05.980 --> 00:27:08.980 You can't pump in spending and you take it out. You can't do both at the same time. 225 00:27:08.980 --> 00:27:13.980 Despite all the equations and computer or whatever, you can't pump in spending and take it out at the same time. 226 00:27:13.980 --> 00:27:19.980 So they were finished. I mean, especially Keynesians have been dead from the neck up since 1974. 227 00:27:19.980 --> 00:27:24.980 It doesn't mean they quit. Nobody ever quits. It's one of Rothbard's laws of sociological laws. 228 00:27:24.980 --> 00:27:29.980 I have a whole bunch of them, which have evolved over the years. And one of them is nobody quits. 229 00:27:29.980 --> 00:27:34.980 It's not an apodictic law like praxeology. And once in a while somebody does quit. 230 00:27:34.980 --> 00:27:39.980 This is a good empirical generalization of high predictive value. 231 00:27:39.980 --> 00:27:43.980 So it's coherent and it has great predictive value. 232 00:27:43.980 --> 00:27:50.980 Anyway, so they hang in there, they find the best they can, they pump in a little bit of spending, take out a little bit of spending, hope that something works. 233 00:27:50.980 --> 00:27:59.980 In this situation, in this real collapse of Keynesian, I mean, Keynesian theory had a lot of weaknesses before, ever since Modigliani's first equations, 234 00:27:59.980 --> 00:28:12.980 It became evident that it assumes that wage rates are fixed downward, which nobody really realized before, but a practical political collapse is much more important than, unfortunately, in real life than a theoretical collapse. 235 00:28:12.980 --> 00:28:23.980 So with this political collapse, Keynes, as I say, was really bankrupt, and this begins to dissolve a ruling hegemonic paradigm and people looking around for other answers. 236 00:28:23.980 --> 00:28:24.980 Answers. 237 00:28:24.980 --> 00:28:31.180 The next year, Hayek gets the Nobel Prize, and one of the interesting, in tandem of course 238 00:28:31.180 --> 00:28:36.460 with the left-wing socialist Gunnar Myrdal, not to make it too, you know, too terrible 239 00:28:36.460 --> 00:28:37.460 and reactionary. 240 00:28:37.460 --> 00:28:40.980 Now the interesting thing, this is a big chock-a-roo to the economics profession, and one thing 241 00:28:40.980 --> 00:28:46.860 I want to stress here, I don't want to disillusion any young students here, but economists are 242 00:28:46.860 --> 00:28:51.860 almost all obsessed with the Nobel Prize, I mean there's betting pools every, in the 243 00:28:51.860 --> 00:28:56.860 in the early fall, who's going to get it this year, and there's all sorts of stuff going on. 244 00:28:56.860 --> 00:28:59.860 Everybody's very interested in the Nobel Prize and who's getting it. 245 00:28:59.860 --> 00:29:04.860 Before Hayek, as I remember, all the recipients, almost without exception, were mathematical Keynesians, 246 00:29:04.860 --> 00:29:09.860 Keynesian econometric types, and all of a sudden Hayek gets it. 247 00:29:09.860 --> 00:29:11.860 Who the hell is Hayek? Nobody had ever heard of him. 248 00:29:11.860 --> 00:29:17.860 You see, one of the things about the economics profession, they're not exactly steep in their own history. 249 00:29:17.860 --> 00:29:35.860 If something is written 10 years ago and nobody knows about it, because it becomes, it's part of the model of physics. If economics is a hard science like physics, which all these people hope and think it is, then, you know, physicists don't read 1930s physics unless they're antiquarians, which is what Einstein did or something. 250 00:29:35.860 --> 00:29:41.860 Basically, you read the latest journal articles, the latest textbooks, and that's it. You don't worry about what some bozo thought 20 years ago. 251 00:29:41.860 --> 00:29:49.860 And so trying to make this the paradigm in economics results in tremendous loss of knowledge on the part of most economists. 252 00:29:49.860 --> 00:29:52.860 So who's Hayek? How did this guy get the Nobel Prize? Who is he? 253 00:29:52.860 --> 00:29:57.860 And then it becomes a resurgence because people look back, they want to find out what did he say to earn him the Nobel Prize? 254 00:29:57.860 --> 00:30:00.860 And by then, well, this is interesting, I've never heard of this. 255 00:30:00.860 --> 00:30:10.860 So with this research, unfortunately, some of us conspiracy theorists, this is of course a totally unproved hypothesis, it's been cherished by many. 256 00:30:10.860 --> 00:30:21.860 I don't necessarily hold it, but some of my friends do, is that the point is that Hayek got his Nobel Prize not for this later stuff, not for evolution and the rule of law, that sort of thing. 257 00:30:21.860 --> 00:30:29.860 He got it for his Misesian business cycle theory, which he had expounded and elaborated in the late 1920s and early 1930s. That's what he got it for, explicitly. 258 00:30:29.860 --> 00:30:49.860 So the conspiracy hypothesis is that they waited for Mises to die before they gave Hayek a Nobel Prize, because Hayek, Mises died in 1973, Hayek gets it in 1974, and they would never give a Nobel Prize to a monster like Mises, so they waited for Mises to die for giving it to Hayek. 259 00:30:49.860 --> 00:30:57.860 It was much more of a compromiser. If you read the Constitution of Liberty, for example, there's pro-planning stuff, pro-status stuff all over it. 260 00:30:57.860 --> 00:31:27.860 So, at that point, this sort of sparked a regeneration and revival of Austrian economics. It might not be a total causal connection, but it certainly is an impressive coincidence that the first Austrian seminar since old Austria occurred, a conference, a week-long conference occurred in Royals in Vermont in the summer of 1974. All the younger, whatever Austrians there were, were gathered together. It was a wonderful thing because we all met each other for the first time, mostly. 261 00:31:27.860 --> 00:31:57.860 And Austrianism was fantastic, it's just like saying the catacombs, and Austrianism flourished, of course it was a shame that Mises didn't live to see this, and after fighting with all his life for these ideas, and then we had annual conferences for several years after that, it was a big flourishing movement, and Austrianism was becoming known and widely, people were interested in England and the United States, 262 00:31:57.860 --> 00:32:27.860 and then something happens, light suddenly goes out, see the history of thought and history in general is not an onward and upward into the light, it's a series of glitches, it's sort of like a, I wouldn't say a business cycle, but ups and downs, a zigzag effect, so suddenly there was a big zag after this impressive zig of the late 70s, something happened and the Austrian, younger Austrians at the time started saying, well, troubled Mises says he's too dogmatic, too uncompromising, too extreme, 263 00:32:27.860 --> 00:32:50.860 How do you get respectable in the mainstream of economics, keep pushing these ideas that nobody really likes and we should really try to become respectable, we should drop all the stuff about praxeology and laissez-faire and talk about market, market process, whatever, and the dread name Mises begins to slip out of sight. 264 00:32:50.860 --> 00:33:17.860 And this is of course really replicating in death what Mises had suffered in his life except this time it was essentially a stab in the back by people who called themselves Misesians who understood the situation and then basically sold out, if you look at it very bluntly, sold out for potential respectability funds, mainstream publications, tenure and all the rest of it. 265 00:33:17.860 --> 00:33:33.860 Well, in this rather dire situation, and it's not an accident, by the way, that the funding sources, almost a single funding source for this whole revived Austrian movement in the late 70s, which is flourishing fairly nicely, 266 00:33:33.860 --> 00:34:03.860 was one person, one billionaire, and the billionaire had a paradigm shift in his head, and all the other acolytes, so to speak, or fundees of the billionaire, suddenly, coincidentally shifted with it, into this idea of, and we began to hear, as I say, not only Mises was too extreme and too dogmatic, you know, talk about him, we began to talk about synthesis with Marxists, this has been the latest development since like 1980 or so. It's important for Austrians to really understand the great contributions of Marxists, 267 00:34:03.860 --> 00:34:33.860 Marx and Lenin and so forth, and we should have a continuing dialogue, and I'm sure you're able to appreciate this and fight for the Soviet Union to come to the United States or Austria to find out, hey, we should have a synthesis with Marxists, right, let's join in, or a synthesis with nihilism, and there's no truth, how do we know anything is true, all sort of fashionable, philosophic guff, Marxo-Freudian nihilist guff from the continent, and this became, it was becoming the ruling paradigm because the 268 00:34:33.860 --> 00:34:41.860 Mayor, funder was in favor of it, basically, I don't want to have a simplistic mono-causal analysis here, but that's the way it looks to me. 269 00:34:41.860 --> 00:34:52.860 In this situation, in this pretty grim and depressing situation where Austrianism has really collapsed, Austrianism, as I said in the first last week, is really Misesianism. 270 00:34:52.860 --> 00:35:00.860 In this situation, one person decided to do something about it, and this person is Lew Rockwell, who is responsible for everything we have today. 271 00:35:00.860 --> 00:35:30.860 What Lew had been, see Lew, all these other people, the Austro-Marxists, whoever you want to call them, were moving to Washington. I like Washington. I thought this is where the power is. This is where you can get goodies and respectability. Lew had spent a lot of time in Washington, hated it, wanted to get out, both spiritually and physically. 272 00:35:30.860 --> 00:35:38.340 and he decided that he wanted to found the Mises Institute, which was a dream of his life and he decided this is the time to do it 273 00:35:38.340 --> 00:35:44.080 and he wanted to revive the Misesian paradigm and the name of Mises and all the rest of it 274 00:35:44.080 --> 00:35:51.340 and he went to the four-step billionaire and he thought it was the Misesian and he said, well, I want to found the Mises Institute 275 00:35:51.340 --> 00:35:58.960 and he was ordered not to do it. Kind of an interesting point here, how could he be ordered since he was an employee of this person? 276 00:35:58.960 --> 00:36:01.180 In order not to do it, you can't do it. 277 00:36:01.180 --> 00:36:04.220 Of course, Lew, if you know Lew at all, 278 00:36:04.220 --> 00:36:08.960 doesn't accept these kind of orders very neatly. 279 00:36:08.960 --> 00:36:12.060 So Lew went ahead with no donations, no endowment, 280 00:36:12.060 --> 00:36:16.280 no pledges, no big daddy billionaire, nothing. 281 00:36:16.280 --> 00:36:21.000 Just an idea and tremendous energy and organizational genius, 282 00:36:21.000 --> 00:36:23.520 entrepreneurial genius of the highest order. 283 00:36:23.520 --> 00:36:26.360 And as a result, we have all this today. 284 00:36:26.360 --> 00:36:35.360 We have a fantastic Mises Institute, and we have just to run down some of the things the Mises Institute is doing, because I think it's important. 285 00:36:35.360 --> 00:36:46.360 It publishes a quarterly, oh, by the way, in addition to the, it publishes an annual journal, the Review of Austrian Economics, which is now going semi-annual, by the way. 286 00:36:46.360 --> 00:37:12.360 I'm happy to report, it's, and by the way, the Austrian Journal was boycotted by these aforesaid ex-Austrians, organized the boycott, which happily was not successful, and the, it has, it publishes a quarterly Austrian economics newsletter, which is sort of like a quarterly discussion magazine in Austrian economics. 287 00:37:12.360 --> 00:37:19.360 published in the monthly free market, which is marvelous for application of Austrianism in general and extremely successful. 288 00:37:19.360 --> 00:37:26.360 And it publishes books which are getting even more, we're going to be even more books in the future, talking about the future of Austrian economics. 289 00:37:26.360 --> 00:37:37.360 Kluwer Publishers, which have taken over the review of Austrian economics, are extremely excited about the future of Austrian economics, about Mises Institute and the future of Austrian economics. 290 00:37:37.360 --> 00:37:43.360 Not because they're ideological buddies, I don't know what they are or not, but I see it as a great marketing, great prospect of the future. 291 00:37:43.360 --> 00:37:48.360 And publishers are very astute in this, and they're particularly quite astute. 292 00:37:48.360 --> 00:37:53.360 I mean, they found, for example, Hans Hoppe's Theory of Capitalism and Socialism, which they published. 293 00:37:53.360 --> 00:38:00.360 They were amazed to see, under Mises Institute's auspices, they were amazed to see he was a bestseller, an academic bestseller, being translated in many languages. 294 00:38:00.360 --> 00:38:15.360 So this is deeply moved, the Clure people. So the, so we, and we have, we have, we're going to have three books a year, I think, which Clure wants to publish, Austrian type books, Mises Institute books. 295 00:38:15.360 --> 00:38:28.360 We have all sorts of books we publish on our own, pamphlets, monographs, and conferences we've been putting together for a long time and building up to the present one. 296 00:38:28.360 --> 00:38:39.360 Also special conferences like the desocialization conference I mentioned last year, conferences on Keynes, on Marx, on the Federal Reserve system, and all these conferences are going into books. 297 00:38:39.360 --> 00:38:47.360 In other words, we believe in the contrast of many other institutions. There's another institution which I won't mention which believes that every conference is an end in itself. 298 00:38:47.360 --> 00:38:56.360 You've got a conference, everybody should go home and nothing should be published out of it. And we believe quite the opposite. Every conference should build on previous conferences. 299 00:39:26.360 --> 00:39:33.360 Each professor teaches to the whole plenary group, and each one teaches three times or four times or whatever. 300 00:39:33.360 --> 00:39:37.360 Well, this seemed to work pretty well, so everybody sort of fell into this mold. 301 00:39:37.360 --> 00:39:44.360 And what Lew realized a couple of years ago, Lew Rockwell realized a couple of years ago, this is limited. 302 00:39:44.360 --> 00:39:49.360 In other words, you've got, you only have four professors, you only have a certain amount of students, everybody gets the same thing. 303 00:39:49.360 --> 00:39:55.360 Why not have a university concept? Why not have it so you can have a lot more professors? 304 00:39:55.360 --> 00:39:58.720 Professor, and we had a lot more of the thing is more professors are coming into the movement. 305 00:39:58.720 --> 00:40:02.920 So you have a lot more people growing up into it, first starting as students and then ending 306 00:40:02.920 --> 00:40:05.680 up as professors like Mark Thornton. 307 00:40:05.680 --> 00:40:10.520 So why should we have these people also give and be here and also give their own particular 308 00:40:10.520 --> 00:40:11.520 expertise? 309 00:40:11.520 --> 00:40:16.080 In other words, have courses like a real university, okay? 310 00:40:16.080 --> 00:40:20.360 And then we always had a problem in the old days in Austrian courses in the summer. 311 00:40:20.360 --> 00:40:24.520 Somebody would teach Austrian economics and the level was always bad. 312 00:40:24.520 --> 00:40:29.920 In other words, there'd be all sorts of people there from high school students, the businessmen, the graduate students, the young professors, 313 00:40:29.920 --> 00:40:34.920 and everybody was always griping about the level because some people thought it was too tough, other people thought it was too easy. 314 00:40:34.920 --> 00:40:41.420 How do you get the level? It was okay when they were teaching political philosophy or history because everybody was more or less the same level. 315 00:40:41.420 --> 00:40:44.620 What do you do about economics? And so, we got the idea, you separate it. 316 00:40:44.620 --> 00:40:52.120 You have elementary courses, you have intermediate courses, advanced courses, and you tailor each course to the needs of a particular student. 317 00:40:52.120 --> 00:41:06.120 And we wound up with the Mises University concept, which is a blockbuster, it's an unbelievable example of creative and ideological entrepreneurship and innovation in this field, which is a field which is not really recognized as a field, but should be. 318 00:41:06.120 --> 00:41:15.120 So we had, and last year was a fantastic success and everybody loved it, and this year even more so, each year is better than the preceding one. 319 00:41:15.120 --> 00:41:18.120 In this case, the Whig Theory of History seems to work. 320 00:41:18.120 --> 00:41:23.760 So, and the only thing I don't like about it, in a sense, is that it's like a real university. 321 00:41:23.760 --> 00:41:26.360 You don't see that if you want to talk to people, you want to talk to my friends or whatever, 322 00:41:26.360 --> 00:41:29.000 oh, sorry, I have to go off to the next class. 323 00:41:29.000 --> 00:41:33.360 That's inevitable as the university takes over, so to speak. 324 00:41:33.360 --> 00:41:40.280 So, and we have more faculty, more students and different segregation, so to speak, 325 00:41:40.280 --> 00:41:43.280 by quality and depth of courses. 326 00:41:43.280 --> 00:41:46.880 As a result, people can come back year after year because they can take more advanced courses 327 00:41:46.880 --> 00:41:58.680 In addition to that, we have, by the way, I should say that there's an unexplored field, 328 00:41:58.680 --> 00:42:03.320 I think I mentioned Mises' bureaucracy, unexplored field of economics and non-profit organizations. 329 00:42:03.320 --> 00:42:05.400 It's almost not been worked on. 330 00:42:05.400 --> 00:42:07.680 People are interested in what can they work on in Austrian economics. 331 00:42:07.680 --> 00:42:08.680 Here's an area. 332 00:42:08.680 --> 00:42:09.680 How do you calculate? 333 00:42:09.680 --> 00:42:13.480 It's easy to see how you calculate a profit-making institution, profit and loss. 334 00:42:13.480 --> 00:42:15.000 How do you calculate efficiency? 335 00:42:15.000 --> 00:42:18.000 How do you make sure that you don't have a bloated organization? 336 00:42:18.000 --> 00:42:20.000 It's very difficult. 337 00:42:20.000 --> 00:42:27.000 And unfortunately, many audiological organizations, whether libertarian or other, tend to become bureaucratic. 338 00:42:27.000 --> 00:42:35.000 They tend to be overweighted with dead wood, overstaffed, underproduced, underproductive. 339 00:42:35.000 --> 00:42:37.000 The quality tends to go down. 340 00:42:37.000 --> 00:42:41.000 The emphasis tends to be on show rather than content. 341 00:42:41.000 --> 00:42:54.000 And what Lew has done as part of his entrepreneurial magnificence, I think, what he's done is, is to have an organization here which has the highest marginal productivity of any organization in the country, or more than none, a non-profit organization in the country. 342 00:42:54.000 --> 00:43:03.000 In other words, fantastic output. Every person here has a very tight ship. I mean, the staff is about, I don't know, one-third of any comparable organization. 343 00:43:03.000 --> 00:43:10.000 Each person is dedicated, extremely competent, and works very hard. And as you probably all know this week. 344 00:43:10.000 --> 00:43:15.600 So, and the result of this is the growth of the Mises Institute, both in content and quality 345 00:43:15.600 --> 00:43:19.000 and in quantity and in influence. 346 00:43:19.000 --> 00:43:24.960 Essentially we've beaten the Austro-Nialists and the Austro-Marxists, I mean, they're out 347 00:43:24.960 --> 00:43:30.000 of the picture, they've had it, and doing it against tremendous odds, in a sense, against 348 00:43:30.000 --> 00:43:34.120 the odds of a billionaire opposition, in a sense it's very much like Mises conquering 349 00:43:34.120 --> 00:43:38.280 in the long run over the odds that he faced. 350 00:43:38.280 --> 00:43:45.120 And one interesting thing also about Mises' strategy and general strategy and outlook, 351 00:43:45.120 --> 00:43:50.000 we wanted to form a graduate school in economics, I forget now it was the 1950s or 60s, somewhere 352 00:43:50.000 --> 00:43:52.320 around those dark ages. 353 00:43:52.320 --> 00:43:55.280 And Mises was going to be the president of this graduate school, it was going to be called 354 00:43:55.280 --> 00:43:57.780 the American School of Economics. 355 00:43:57.780 --> 00:44:03.440 And he insisted, us younger people were on the board of trustees because they wanted 356 00:44:03.440 --> 00:44:15.840 Mises kept saying, don't forget, as you're doing this high theory and scholarship, don't 357 00:44:15.840 --> 00:44:19.200 forget to have continuing lectures of the businessmen and the general public. 358 00:44:19.200 --> 00:44:23.960 At the time, I didn't really understand that, but why does he keep making this point? 359 00:44:23.960 --> 00:44:27.560 But I understand it very well now, especially since Joseph Salerno was pioneered and lookingivided 360 00:44:27.560 --> 00:44:33.560 back over the Mises-Hayek differences between Mises and Hayek on the economics of socialism 361 00:44:33.560 --> 00:44:38.400 and also on the economic, on the general, on the rational versus the irrational view 362 00:44:38.400 --> 00:44:41.360 of exchange and specialization. 363 00:44:41.360 --> 00:44:44.920 The point that Mises was really making was that since he believed that people do change 364 00:44:44.920 --> 00:44:51.080 history, that ideas do change history, that people are conscious actors and their decisions 365 00:44:51.080 --> 00:44:56.240 really determine events, it's very important for everyone, not just scholars, not just 366 00:44:56.240 --> 00:45:06.240 to philosophers and economists. It's important for everyone, all the general public, businessmen in the public, to understand the importance of the free market, to understand that crippling the free market is death, in literal sense. 367 00:45:06.240 --> 00:45:14.240 It leads directly to the terrible situation in Eastern Europe from which they finally got rid of, getting rid of. 368 00:45:14.240 --> 00:45:24.240 So it's very important not just to get the high-flung journal articles, it's also and equally important to spread the basic truths of free market and laissez-faire 369 00:45:24.240 --> 00:45:29.240 and the evils of collectivism and interventionism spread that to the general public and the business. 370 00:45:29.240 --> 00:45:35.240 And that was the point. It wasn't just sort of a peculiar whim on the part of Mises. 371 00:45:35.240 --> 00:45:43.240 It was rooted in his general strategic theories, the theory of life and the importance of reason and ideas on historical events. 372 00:45:43.240 --> 00:45:48.240 The interesting thing about Mises is the more I read him and go back and read the stuff, the greater it looks. 373 00:45:48.240 --> 00:46:06.240 So looking into the future and looking into what are the prospects for Austrian economics, I think it's inherent in the current situation. 374 00:46:06.240 --> 00:46:13.240 Obviously it's not determined by, but certainly we get great leads to what we can expect in the future. 375 00:46:13.240 --> 00:46:21.240 namely, I mean, just look at the fact that in Eastern Europe, the economists of Soviet Russia and Eastern Europe, Mises and Hayek are revered figures. 376 00:46:21.240 --> 00:46:27.240 Nobody reveres Keynes and Galbraith out there. They had it with socialism and statism. 377 00:46:27.240 --> 00:46:31.240 They're just trying to figure out how to get to what we've been advocating all this time. 378 00:46:31.240 --> 00:46:40.240 And if that's true in a system where human nature is supposedly transformed, obviously it wasn't, it should be also true, of course, in the West and in the United States. 379 00:46:40.240 --> 00:47:10.240 and we haven't gotten to the socialist stage yet and with the growth of the power of ideas I really think in the long run truth wins out of course this could be a very long too long run for us to worry about but I think it's winning out right now in the short run, in a medium run, if you want to put it that way and we have with the growth of the influence of Austrianism and Mises Institute and the prospects look terrific. 380 00:47:10.240 --> 00:47:40.240 Continuing Growth as I said in Quantity and Quality and I think one of the lessons of looking back on the Mises himself and the Mises Institute itself is not to cave in, not to think you're going to be going to, don't sell your soul for mess of pottage so to speak, because that's what you're going to get, mess of pottage, if that, what happens is that in the long run, which is not very long, these compromises and caving in simply don't work, don't work pragmatically. 381 00:47:40.240 --> 00:47:43.240 I think we're going to win. Vinceremos. Thank you.