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NOTE The Mises and Hayek Critiques of Modern Political State

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I have handicapped feet, therefore if I don't rise, as I should rise, I can't really do

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it properly without throwing over everything here.

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Now talking about Ludwig von Mises as a man, and we speak about his cultural background,

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my lecture is really restrained to that subject.

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You must realize that he is difficult to order in socially, and as you will see, to order

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in nationally, ethnically, he is a man between all camps and all situations.

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He is born in Lwów, that is the Polish name, Lwów would be the Ukrainian name, Lemberg

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That would be the German name of Galicia.

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The Kingdom of Galicia was southern Poland, really southern Poland, incorporated into

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Austria in 1772, the first partition of Poland, and of course his origins were Jewish.

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His grandfather was the head of the Jewish cultural community, which was a state institution

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and to teach and to practice religion, like the Catholic Church or the Lutheran Church.

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And as you will see, thereby, then the grandfather became nobilitated.

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He belonged also to the minor nobility.

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And his upbringing was in a society which was largely Polish, naturally Jewish, Polish.

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He spoke German from childhood on, but he also spoke Polish.

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In all likelihood, he did not speak Ukrainian because there were really three nationalities

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in Lemberg.

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The vast majority of the inhabitants of that city were Polish, make him a very large Hebrew

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sector and finally also a Ukrainian sector.

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So he was conversant in all likelihood with the German script, with the Latin script, with

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the Hebrew script, and with the Cyrillic script, I mean from the upbringing you can see in

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the school.

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In other words, he was faced initially by enormous variety of cultures, civilizations.

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Now the Hebrew element had come into Poland from Germany.

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In Germany, the Hebrews lived in large quantity, especially on the Rhine, but constantly disturbed

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by popular rising which mobbed the ghettos, and never forget here one thing, a ghetto was

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a privilege, it was self-government, it was certainly not an action of the government

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to enclose them, but through their demeanor and their clothing and their accent and their

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rituals and their religion, and unfortunately, since they were the money lenders, because

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according to their own faith, they could only lend money to gentiles, and in the Middle

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Ages, the gentile was prohibited of lending money to another gentile, in other words,

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a Catholic to another Catholic.

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So they were in a difficult position and King Kazimir the Great of Poland, who had ruled

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of an agrarian country, an almost purely agrarian country without any bigger cities, called

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into the country German settlers and with them also the Jewish settlers, both of them

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could converse with each other obviously because Yiddish after all is a form of medieval German

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And then they built the cities, and that is the background.

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In Poland, on the other hand, they had no ghettos, they had no such privilege, if you

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like, and they lived together, together in freedom.

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They had a kaha, it was a sort of community, and since they couldn't walk on the Sabbath

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was more than 2,000 steps, so they congregated, naturally congregated.

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Now that is, you see, also his religious background, however he lived, and that is now very important,

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he lived in Galicia, that is southern Poland, and the southern Poland under Austrian administration,

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In other words, of a country which had a variety of nationalities, German, Czech, Polish, Ukrainian,

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Italian, Slovenian.

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This country became that part of partition Poland, partition between Austria and Russia,

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which had the greatest liberties.

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There were two universities.

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There was a university in Lwów, in Lemberg, where he was born, a university in Krakow.

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And many Poles said that the restoration of Poland was only possible having greater rights,

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greater privileges, and becoming the foundations of a once later reunited Poland.

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So they were very loyal to the Habsburg family.

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The Polish delegates in the parliament in Vienna were always, perhaps, pro-Austrian, at the

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same time, of course, thinking, we are going to be the basis of a reunited Poland, and

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maybe, under certainly, under the same house, under the same dynasty.

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Always bear in mind, very, very important to bear in mind, that monarchy in Europe was

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an international institution, not a national institution.

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If you take the year 1910, you only find two dynasties which are truly native, the dynasties

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of Montenegro and the dynasty of Serbia.

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The House of Saxe-Coburg also, for instance, ruled in England and in Belgium and in Saxe-Coburg

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and in Portugal and in Bulgaria.

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And the House of Sonderburg-Luxburg-Augustenburg ruled in Norway and in Denmark and in Greece.

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In the whole, Salernes are not Russians, they are Alemannic, they come from a different

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part of Germany.

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They also ruled in Romania.

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So you see, the idea was here of countries ruled by foreigners who had a real distance

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from the local population.

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Very curious, the Swedish laws for the Swedish dynasty, they can marry aristocrats and they

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They can even marry commoners, provided they are foreigners, but nobody within the country.

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Because then of course you get a sort of either with industry or agriculture you get a connection.

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You should have a sort of feeling of equal distance.

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Now you see then of course in Poland and that Polish atmosphere, Poland had an enormous

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claims nobility. In other words, in Poland, according to one Polish scholar, about one quarter of the Polish population claims nobility.

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Now in Austria, for instance, in Little Austria, it's about a third of one percent, but there are 24 percent, and 11 percent can prove it with documents.

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is another maybe five, six percent who are noble but don't have the necessary documentation.

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And this nobility prior to the partition of Poland had its own sense of equality.

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There's a Polish saying, which means the little noble man in his primitive abode is just equal

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to the great magnate who might have 120 servants.

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And then, of course, the pride is very, very important.

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I mean, this nobilitarian aspect, which you then see in the development of the Austrian

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economy, that all has a relation to it, that, of course, led to the transformation of the

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The kingdom of Poland into an elective monarchy, of course elected by the nobility, huge masses

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were elected, and after 1572, the Polish kingdom was re-veptized into Czechoslovakia, and that

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means republic, so you had a Polish republic with a very powerful parliament, the same,

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but in the same since any nobleman were really equal, and the idea that one nobleman could

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rule over another one was distasteful, every decision had to be unanimous.

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In other words, the vote of one man, the liberal way to say I don't accept that law, of course

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made the law unacceptable, and that of course led finally to this big realm, never forget,

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the Polish-Lithuanian Church of Post-Polita was a country bigger than France, it was a

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huge country, led to its weaknesses and its partition.

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But you see here that spirit of freedom, the spirit of freedom, another Polish saying, was

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fight against other kings but oppose your own one, you see, to zifro gromish magruzis

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swojemu.

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So you see here that spirit, very, very important for the development of young Ludwig von Mises

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living in this atmosphere, now he belongs to the nobility.

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Remember, forget in the old times, any Hebrew became a Christian, it happened of course

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again and again, immediately, automatically, was becoming a member of the Schlachter, of

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the nobility, because obviously, I mean, being a Hebrew, you were a relative of our Lord,

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so therefore you have it.

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You see here, a world so radically different from yours, but with an enormous love for

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freedom and an enormous tolerance, religiously speaking, Poland was the most tolerant country

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in Europe as far as religions go.

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When you compare, let us say, Poland with England, there's just no comparison.

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Poland actually, when the big wave came, the big wave of the reformation, you know, one

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third of the Poles became Calvinists, became Presbyterian, another third became Unitarian,

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but when I say Unitarian, please forget now totally Boston and Unitarianism, quite, quite,

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quite different from the Bostonian kind, but then the Catholic Church regained it, but

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to short pressures. Culturally, the Jesuits, of course, played a tremendous role. At that

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time, the Jesuits still were devout Catholics, which today they are only sporadically. So

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these Jesuits then finally had the right schools. They took anybody into their schools. Then

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they propagandized their faith with the theater. Never forget the Jesuits are the founder of

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and the technology of the modern stage, theatrical performances to school, the building of wonderful

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baroque churches and paintings and culturally.

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So finally the Unitarians disappeared completely without duress, and the Presbyterians also

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disappeared almost, I would say, without leaving a trace.

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So there he grows up, you can imagine a young Ludwig von Mises belonging to the nobility

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but still officially remaining Hebrew, remaining Jewish.

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Then later on comes to Vienna but starts his schools in Ruf and then he comes to Vienna

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and now you take the schools in which he has been.

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I mean, what were the schools?

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The four years elementary, and he went to public schools, as most of the children go.

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Private schools in Europe are very, very rare.

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My own children, those of my wife, my father, we all went to public schools.

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They were highly disciplined, I can assure you.

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And then after four years of elementary, you had to make an entrance examination into a

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to a school, which is a combination of quasi-combination of high school and college, but without real

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choice of subjects, eight years, and these eight years are the worst years in your life.

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I can assure you the concentration camp or the cancer ward comes as a relief, and you

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You ended up at the age of about 18 becoming a bachelor and then you go to a university

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which is purely a graduate school and you study either theology or medicine or law or

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what is called philosophy.

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So you see that is the career, he studied law, that is the career, the education which

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he received.

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In other words, obviously he could read Latin and Greek and he spoke Polish and he spoke

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fluent German and I'm absolutely certain that if you take the social position of his family,

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he must have spoken also French and certainly had, even long before he came to America,

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He must have learned English because, needless to say, that he knew all the great English

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economic writers in the original.

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So that is his growth.

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Now you take liberalism, liberalism was in Europe in the 19th century leading a very

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powerful party.

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liberal parties in all the country, but at a still restricted election system, and that

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helped them.

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In other words, there were qualifications to vote.

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Now in Austria, these qualifications disappeared in 1908, after 1908, you have one man, one

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vote, and then the liberal parties receded.

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Now the great party of Bismarck, Bismarck originally was a conservative, but he ceased

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used to be one and it was the National Liberal Party which helped Bismarck.

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And of course in the principle of liberalism is freedom.

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Now we must go into the analysis of the word liberal as the word is used worldwide and

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that means when I speak, I call myself an arch-liberal, when we speak about American

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and Liberalism, what you call in your country liberalism,

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it is just the opposite.

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And there are so many misunderstandings between,

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I think about Santa Claus, who has nothing to do whatsoever

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with Christmas, or the word Holocaust,

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which really has nothing to do with genocide,

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and so forth and so forth.

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Or the Middle East, you put Palestine into the Middle East

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and where's the nearest, of course you don't find it.

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So in other words here, what is liberalism?

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Whereas democracy answers the question, it's also very important for our lecture, answers

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the question, who should rule?

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The answer it gives is the majority of politically equal citizens, either in person or through

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their representatives.

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Whereas liberalism, rightly understood, doesn't answer the question, who should rule?

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But how should government be exercised?

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Liberalism says, regardless of who rules, whether it's an absolute monarch or a dictator

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or a political majority in the parliament, government must be exercised in such a way

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that each individual has the greatest, of course, reasonable amount of freedom.

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You can't say, I'm a great liberal, I'm going to drive 100 miles an hour through a village.

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But you see here, freedom is the essence, and there were really four phases.

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There are the pre-liberals, a man like Adam Smith, who never called himself a liberal.

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And the word, of course, politically comes from the country, which had always the greatest

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enthusiasm for freedom, and that is Spain.

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Now the supporters of the Constitution of Cardiff called themselves Los Liberales and called

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their enemies Los Serviles, the servile ones.

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South in England used the word in 1860 the first time and he spoke about our British

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liberales, L-E-S, Spanish form.

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And so Walter Scott spoke about libero, A-U-X, he took the French form.

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The origins of liberalism of course is continental, it's not British, it's not English.

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And then after the pre-liberals to get the early liberals, very, very important, the

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early liberals, and of course these periods overlap in time.

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The early liberals would be de Tocqueville, would be Montalembert, would be Lord Acton.

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These are the early liberals.

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Then you have the old liberals, they come later, Cobden, for instance.

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Now our friend Mises really was an old liberal, Hayek was an old liberal.

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And then finally after 1961, after the breakup of the Montpellier society, you get the new

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liberals.

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I call myself of course a new liberal, following Röpke rather than Hayek and Mises, but of

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course I knew them all, I knew Hayek well, I knew Mises quite well, I knew Röpke very

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well, he was also a very personal friend of Hayek, I spent the summers a week in the Alps,

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was an inexhaustible source of information, both Hayek and Mises, as you know, really

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died as non-marginarians.

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No, but of course the liberalism got into a crisis in Europe, especially when you had

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one man, one vote.

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Because the vast majority of people, we have to face that fact, if they make a choice what

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What they believe, not what is, but what believe is security and freedom.

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Well, of course, they choose always security, the bread, the daily bread and security and

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freedom.

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And the people who have a real vested interest in freedom, I mean, I say a vested interest,

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a realized interest in freedom.

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for the people of a minority, usually people who are creative one way or the other.

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Now what of course Mises experienced before World War I, especially after World War I,

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never forget, Mises was in the army because the system was, if you had your bachelor's

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degree, which he had, then you had to serve in the army, but only one year.

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All the others had to serve in Austria for three years in the army, but he served only

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one year.

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And at the end of one year, you got the commission as a reserve officer.

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So he served as a reserve officer in World War I in the Imperial and Royal Army, I say

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Imperial and Royal, Imperial for Austria and Royal for Hungary.

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There were two different citizenships, don't forget that.

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Many things in common, but two different citizenships.

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He then was wounded, not very seriously, but wounded sufficiently to be no longer capable

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of participating in the war.

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And after the war, he was seeking, as you do know, for an academic career in the university

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where he had of course difficulties,

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difficulties not on account of his racial background,

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if you like, but difficulties around of his liberal outlook

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because the university was increasingly professors,

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were increasingly either Catholic oriented

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with a conservatives land, but as a minority,

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The majority really was nationalistic liberal.

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The German expression is Wir sind geschlindert.

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In other words, in which we fell accidentally that it became a war between nations.

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Of course it was a war between nations already due to the French Revolution.

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Prior to the French Revolution we had mere cabinet wars.

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The cabinet war was king against king, and he had to look into the till, did he have enough money?

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And then he called in for ruffians and cutthroats who liked to fight the war,

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and they had as officers, members of the nobility, who had to bribe a government,

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And he had to buy a commission, bribe a government to die, not waiting for the cancer ward, but

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to die nobly on the battlefield.

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He had to pay for that.

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He didn't burn your draft card, as many Americans did during the Vietnam War.

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So that was the old system.

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And of course, tiny armies, and now you have gigantic armies, and you had democracy, you

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You had parties in the parliament and you had to marshal now entire nations against

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each other.

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The Austrian ultimatum against Serbia would have merely resulted as a matter of fact in

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a local war against Austria, against a small country, and Count Witte, former Russian prime

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minister said, oh these Serbs, they are only badly baptized Turks anyhow.

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But that it became really a world war was really due, and you see how cruel history is, a conspiracy

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between the chief of the Russian general staff and the minister of war, who mobilized not

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only on the Austrian border, to which they had the brief right because Austria was mobilized

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but also against Germany, and then came this frightful exchange of wires between the two,

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The war minister and the chief of the staff lie to Nicholas II.

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William II is now convinced that he's lied at by Nicholas II, and then finally declares

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the war on Russia.

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And then the Austrians have come as allies of Germany.

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The Austrians have to declare the war against Russia, not the Russians, I mean, I could

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I'll tell you 99.9% of all Europeans think it the other way around.

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History is so many, many facets are entirely different.

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But you see the war between nations and nations who are taught now to hate each other, you

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know, is all between nations is then converted in 1917 in something different, something

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we didn't quite have before, and that is into an ideological crusade.

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And it is now since the Russian monarchy falls, Russia becomes a democracy under Kerensky

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and now Woodrow Wilson has a chance to pervert this war between nations, bad enough a war

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between nations, into an ideological crusade to make the world safe for democracy.

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That means now safe for the absolute victory of one party.

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And if Hitler had any sense of humor, he would have erected a colossal statue to Rudolf Wilson.

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Because only in the conversion, you see, into democracies, as Plato has clearly foreseen,

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if you read Plato book eight and nine of the Republic, you see the absolute Xerox picture

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of the Change of the Weimar Republic into the Nazi Tyranny.

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But of course, even before that, you have the onslaught of socialism, and socialism,

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Ludwig von Mises faced that in Austria, this rise, massive of socialism, also at the university.

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You see that socialism is of what de Tocqueville would have called, and he used the expression

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in Another Connection, une false idée claire, a clear but false idea of socialism you can

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explain to any high school student at the age of 15 in 15 to 20 minutes.

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But the working of a free economy, you need a seminar for that.

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So naturally in that democratic framework, one man, one vote, when the masses vote, the

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The attraction of socialism has become enormous and he saw that with great, great fear.

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And of course, he realized naturally that the monarchy was a sort of bulwark against

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this development.

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And of course, also nationalism now with the artificial humiliation of certain countries,

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Nationalism also rose and therefore you get now already the stage in a sense, you see,

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prepared for a national socialism.

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And that could very well even be combined with anti-Semitism because in our central

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European mind, this is not generally true, the idea really was Judaism and the Jews and

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and the Hebrews, and that is capitalist, now the stock exchange in Vienna was entirely

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dominated by Hebrews.

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So you see here that Goebbels also once declared, we are anti-Semitic because we are anti-capitalist.

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There is this combination, the destruction, you see, important of the old vertical order

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now into something horizontal.

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Your old vertical order, Godfather in heaven

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and the Holy Father in Rome,

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and the King is the father of the fatherland,

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and the father is a king in the family.

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It went up and down.

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You looked up and down.

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Now you're looking timidly right and left

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because they are the parties,

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and the parties are based upon masses.

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And these masses, of course,

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are obviously uneducated and facing without real any political education or knowledge

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the issues they can become prey now of demagoguery of popular leaders, it means of demagogues.

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And Mises saw that, this development very, very clearly.

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And of course his mind is how to save freedom.

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And he knew very well that the material aspect of the problem of freedom was very, very crucial,

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especially in view of the socialisms.

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I speak now in the plural of it, because don't forget there is national socialism and international

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socialism.

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There are the socialisms.

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And in the year 1934, the Dolfus regime, which was a dictatorship, which was carried

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by a minority of decent people who were supported by Mises.

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Mises worked as an advisor for Dolphos,

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for a Catholic dictatorship.

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I have nothing against the dictatorship.

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I'm interested in freedom.

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If a dictatorship protects my personal liberty and freedom,

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I'm all for a dictatorship because, I mean,

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my vote alone means really nothing.

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I'm a microbe in the voting process.

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And certainly, Mises realized that.

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He became a financial advisor of Dodolfo's regime.

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And in that year, 1934, there are two civil wars in Austria.

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There's the one in February against the socialists

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and the one in July against the national socialists.

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International and national socialism.

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And Austria was really in the middle of these two enemies.

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Now you must realize that at that period, as you know very well, Mises has been accused

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of having favored fascism in Italy, and he really favored his rise because his interest

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was not democracy, his interest was really always freedom.

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And since in Italy, freedom was really seriously menaced by socialism, hyphen, and communism,

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he thought that fascism really was certainly by all means the minor evil, and I can assure

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you I've lived also in fascist Italy.

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In fascist Italy, if you were not a complete fool, you could live very freely because that

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fascism had really two, how should I say, two breaks on, the one was the monarchy and

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the other one was the Catholic Church.

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And you could live quite, quite freely.

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You could speak freely out, there would be nobody here, your speech was never censored,

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newspapers were, books were, but otherwise you lived a very, you lived a very free life.

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And Italy was then the only power which really protected the independence of Austria.

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When then the Nazis in July of 1934, who revolution tried to get the upper hand, the Italian army

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mobilized, I was in that time in the Tyrol, I saw the mobilized Italian army and Hitler

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was made to know that if he moved into Austria, the Italians would come to the defense of

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of Austro-Independence, because Mussolini naturally realized that if Austria is lost,

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then Czechoslovakia would be entirely surrounded.

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And if Czechoslovakia failed, then Poland would be entirely surrounded.

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There was a domino theory, which certainly, like the other one, was perfectly right.

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So that is his idea, rather having Italian fascism, and you had sometimes, you had liberals

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and Socialist Fleeing Austria went even to fascist Italy.

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And then Italy was driven into the arms of, into the arms of Hitler by Anthony Eden and

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the British foreign policy in the Abyssinian War.

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And then Mussolini said to highly placed Austrians, I can't do anything else.

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I'm completely isolated from the West.

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I must somehow collaborate with Hitler and he very, very reluctantly, as you all know,

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he went into World War II only in the summer of 1940 with great, great reservation thinking

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now that Hitler is going to dominate everything and he should get a little bite here, a little

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to bite there, in order at least to save his own freedom of power of a country pushed practically

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then by Hitler to the Mediterranean.

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So that is, you see the reason why there exists an article about the relationship of Mises

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to Italian Fascism, and to call National Socialism fascism, fascism of course is a leftish, not

354
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a rightist, fascism is a leftish phenomenon, the fascist which you also find on your dime

355
00:34:51.920 --> 00:34:57.040
at the back is a republican symbol and it started out to be a republican movement.

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Mussolini, only being the son of an Italian anarchist, changed his mind.

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Now you get also Mises, we come to World War II, the calamity of World War II, the calamity

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of World War I was enormous, George F. Kennan, whom I also personally know, is the man who

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who says rightly all the sources, all the roots of our evils really go back to World War I.

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That is the great catastrophe really in our life, World War I, which brought in an order

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which favored the rise of the National Socialism and which was won by Germany, better than mine.

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On October 15, 1926, his magnificence, Dr. Ernst Kornemann, magnificence is the title

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of a president of a German university or Austrian university, delivered a lecture and we said

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of course we have suffered the loss of valuable provinces, we have suffered the loss of Aisles-Lorraine

365
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of Eastern Germany to Poland, and our middle class was nearly destroyed and brought to starvation

366
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and ruin, but we have won the war.

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We bordered on three major powers, France, Austria, Hungary and Russia, now we only border

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on France.

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And between us and Russia, there's a whole cluster of new, mostly, except Poland, un-historical

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countries, small and defenseless, and when the time comes, we take our picking.

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Of course, Hitler followed that.

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It's a result of not knowing geography.

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So that was this frightful heritage.

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Now then comes World War II, the result of World War II, the quasi dominance of Sovietism,

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of Communism, and then the rallying for the few surviving, I must say, the whole few surviving

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liberals who are drawing together in 1927, they are forming then near Vevey in Switzerland,

377
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and the Mont Pelerin Society of which Mises was one of the founders.

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Mises and Hayek and Röpke, I mean, these three men really had banded together and organized

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and had quite a cluster of men who came together.

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But then again, something very, very typically happened, and that is that they made these

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00:38:01.400 --> 00:38:09.400
the proposition to call the society, first of all, not a more parallel society, but the

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talk will act in society.

383
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And then Professor Knight of the University of Chicago rose up, panned the table and said,

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if you call that society after two Roman Catholic aristocrats, I'll quit.

385
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Then in the despair, what should we do?

386
00:38:29.400 --> 00:38:43.440
But you see here the aristocratic aspect, very, very important, and the

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nobilitarian aspect of the liberal idea.

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00:38:48.640 --> 00:38:54.920
Chesterton said all aristocrats are born anarchists.

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And never forget here, you see, never forget if I used the word anarchist, bear in mind

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that an anarchist is a liberal, in the real sense of the word, not in the American sense.

391
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A liberal run wild is an anarchist, and you find anarchism, obviously, therefore, you

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00:39:13.960 --> 00:39:20.780
find it only really in the Catholic and in the Russian, in the Russian orbit.

393
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You don't find them anywhere else.

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00:39:22.420 --> 00:39:29.100
You remember the Sacco and Vanzetti case, probably, the older one of yours, Sacco was

395
00:39:29.100 --> 00:39:33.900
probably guilty, Vanzetti in all likelihood innocent.

396
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What happened to the ashes of Vanzetti?

397
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Here we go back to Italian fascism.

398
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The Vanzetti ashes were brought back to Italy, were buried, and became a center of pilgrimages

399
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under the observance of the fascist authorities, and even the Pope, even Mussolini, had really

400
00:39:54.540 --> 00:40:00.700
protested against the execution of Sacco and Vanzetti, and a man called Luigi Rustigucci

401
00:40:00.700 --> 00:40:08.500
wrote a book, Tragedia e Suplizio di Sacco e Vanzetti, Tragedy and Martyrdom of Sacco

402
00:40:08.500 --> 00:40:15.300
and Vanzetti, and the preface was written to that book by Arnaldo Mussolini.

403
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Mussolini, of course, has declared, of course, I despise socialists, but anarchists, we all

404
00:40:21.540 --> 00:40:29.260
really are anarchists, you see, from Romanism and rebellion, leveled against the Irish.

405
00:40:29.260 --> 00:40:35.580
There are no Danish or Norwegian anarchists, I can assure you, or Prussian anarchists.

406
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And that's the growth of the Catholic world, because you see, the Catholic theology is

407
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is profoundly personalistic.

408
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The first idea, of course, is the idea of free will, which reformers denied, of course,

409
00:40:55.660 --> 00:41:00.340
or free will and the denial of predestination.

410
00:41:00.340 --> 00:41:04.660
You are really responsible for yourself.

411
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You are not a puppet in the hands of a creator.

412
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and the personalistic aspect, and of course that always has been also the strength of

413
00:41:19.100 --> 00:41:24.060
the nobility in general, and of course of the Catholic nobility in particular, the man

414
00:41:24.060 --> 00:41:31.580
who tries to slay the beast, Count Stauffenberg, is of course a Catholic aristocrat.

415
00:41:31.580 --> 00:41:37.620
So you go back to that, and then you see the interesting phenomenon of the whole Austrian

416
00:41:37.620 --> 00:41:39.820
school.

417
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Now if you take the Austrian School, that would be Menger, and Wieser, and Boehm-Bawerk,

418
00:41:47.180 --> 00:41:55.380
and Hayek, and Mises, and Haberer, and then finally the only man who is not a noble man

419
00:41:55.380 --> 00:41:58.480
is Machlub of the original.

420
00:41:58.480 --> 00:42:03.940
The whole Austrian School consists of noble men, and all of them hereditary.

421
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That means they were not ennobled, they inherited.

422
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They had already the noble father house, Rany Mead, 1215, the barons who were trying to

423
00:42:19.620 --> 00:42:24.620
get rights and resist the monarch.

424
00:42:24.620 --> 00:42:30.740
The front in France is against the nobility, the nobility always against an almighty and

425
00:42:30.740 --> 00:42:32.740
over-mighty king.

426
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So, see, that is the thing which Americans do not realize apart from the fact that you

427
00:42:40.700 --> 00:42:51.300
see, nobilitation was an instrument for social mobility, because you get always new, now

428
00:42:51.300 --> 00:42:53.780
no longer possible, of course.

429
00:42:53.780 --> 00:43:01.740
Now the only inheritance you can have is hard cash, so no more nobilitations are taking place,

430
00:43:01.740 --> 00:43:07.260
You know, the son of the, even sometimes a great actor, the son of a great artist, the

431
00:43:07.260 --> 00:43:14.300
son of a great professor, the son of a great general, it's only the son of the manufacturer

432
00:43:14.300 --> 00:43:22.940
who can act, or the banker who can inherit the father's strength or the father's achievement

433
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if you like.

434
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And all that was always realized by, all that was really realized by our…

435
00:43:55.580 --> 00:44:00.860
And I get to know him, I get to know him through the Archduke Otto of Austria, because he

436
00:44:00.860 --> 00:44:09.900
was obviously, I mean, a man entirely open to the monarchical idea.

437
00:44:09.900 --> 00:44:15.940
He knew very well how Francis Joseph, when anti-Semitism rose in Austria, and it did rise

438
00:44:15.940 --> 00:44:22.980
in Austria as it rose elsewhere too, I mean, not only in Austria, that Francis Joseph in

439
00:44:22.980 --> 00:44:28.540
In a letter to his empress, which has been preserved, went out in violent terms against

440
00:44:28.540 --> 00:44:29.540
anti-Semitism.

441
00:44:29.540 --> 00:44:38.500
The Jews, they are my subject, like everybody else, I mean, he felt to be the pater patrie.

442
00:44:38.500 --> 00:44:42.980
In other words, a non-political entity.

443
00:44:42.980 --> 00:44:49.580
You see, when Teddy Roosevelt visited Francis Joseph around 1908 or 1909 or 1910, anyhow

444
00:44:49.580 --> 00:44:56.220
Now, in the beginning of the century, he asked Francis Joseph, the majesty, do tell me what

445
00:44:56.220 --> 00:45:04.020
after all is the role of a monarch in this progressive 20th century.

446
00:45:04.020 --> 00:45:08.340
And of course, in 1910, you still could think that this could be a progressive century,

447
00:45:08.340 --> 00:45:11.020
which it indeed wasn't.

448
00:45:11.020 --> 00:45:18.460
And Francis Joseph said, well, it's my task to protect my peoples from the governments,

449
00:45:18.460 --> 00:45:44.780
for the protection of the nations apart from political convictions.

450
00:45:44.780 --> 00:45:51.140
So you see here the role of Mises.

451
00:45:51.140 --> 00:45:58.920
Of course he was very sad about the break between the old liberals and the new liberals.

452
00:45:58.920 --> 00:46:02.300
That happened in 1961.

453
00:46:02.300 --> 00:46:10.940
I was present, I was a member of the Montpellier Society for only two years, 1960, I lectured

454
00:46:10.940 --> 00:46:13.940
there, 1961.

455
00:46:13.940 --> 00:46:18.940
There were many personal reasons, but many impersonal reasons.

456
00:46:18.940 --> 00:46:25.660
The neoliberals really harked back and looked back at the early liberals.

457
00:46:25.660 --> 00:46:35.980
And the neoliberals were adverse to what they call mammothism, in other words, to monopolies

458
00:46:35.980 --> 00:46:41.860
and cartels and so on, because they said, we must have freedom, and freedom means there

459
00:46:41.860 --> 00:46:47.540
must be several enterprises, not one big enterprise, and we end up, of course, we're having no

460
00:46:47.540 --> 00:46:48.540
freedom.

461
00:46:48.540 --> 00:46:52.980
We must have the right of choice, buying this good or that good, or supporting this

462
00:46:52.980 --> 00:47:05.900
or supporting that, and poor Röpke had the first heart attack in 1961, in 1963 I participated

463
00:47:05.900 --> 00:47:13.460
still in the neo-liberal, catholic discussion which took place in Augsburg, but you see

464
00:47:13.460 --> 00:47:15.700
here the confusion.

465
00:47:15.700 --> 00:47:22.820
You get for instance, I know encyclopedias you find at Montpellier society being neo-liberal

466
00:47:22.820 --> 00:47:29.460
which it was mixed until 61, then it became old liberal really.

467
00:47:29.460 --> 00:47:39.060
The old liberals, on the other hand, started slightly to lean towards the neoliberal side,

468
00:47:39.060 --> 00:47:42.660
but Mises weathered that through.

469
00:47:42.660 --> 00:47:45.060
What sort of man was he?

470
00:47:45.060 --> 00:47:54.660
Well, not very tall, sharp features, as you know by his bust and by his pictures, very

471
00:47:54.660 --> 00:48:04.940
He was decisionary in his words, this is right, this is wrong, this is nonsense, this is good.

472
00:48:04.940 --> 00:48:14.720
He was not conciliatory, neither am I, of course, I like that, I admire that.

473
00:48:14.720 --> 00:48:21.660
Not adverse to extremes, il n'y a de supportable que les choses extrêmes, there's only the

474
00:48:21.660 --> 00:48:26.540
The extreme things are bearable, as Anatole Valls used to say.

475
00:48:26.540 --> 00:48:34.100
He was a man of that sort, steadfast, he was a steadfast man, and he gave you the impression

476
00:48:34.100 --> 00:48:41.300
to be a steadfast man, of course, profoundly interested in cultural values.

477
00:48:41.300 --> 00:48:46.460
You see, as I told you when I met him, how he deplored the fact that the death of Robert

478
00:48:46.460 --> 00:48:59.420
The theater, music, everything was near to him, also of course to Hayek.

479
00:48:59.420 --> 00:49:03.980
In many ways the men were of very similar opinion.

480
00:49:03.980 --> 00:49:09.420
The neoliberals were somehow, let us say, more culturally conscious.

481
00:49:09.420 --> 00:49:19.180
The man like Hoppe was very near, let us say, the Catholic outlook, specifically the Catholic

482
00:49:19.180 --> 00:49:20.180
outlook.

483
00:49:20.180 --> 00:49:24.620
Hoppe was a member of the Papal Academy of Sciences.

484
00:49:24.620 --> 00:49:33.420
Hayek, I know, had a short little discussion with Paul II in Latin, and the Pope said,

485
00:49:33.420 --> 00:49:37.820
A long glass of civilized language.

486
00:49:37.820 --> 00:49:47.500
You see, in other words, that they all had a sense of humor, our great liberals.

487
00:49:47.500 --> 00:49:54.980
And of course, I mean, as a final judgment, I must say that both Röpke, the neoliberal,

488
00:49:54.980 --> 00:50:03.300
as well as Hayek, both told me, expressed his verbus, we all are disciples of Ludwig

489
00:50:03.300 --> 00:50:04.300
Ludwig von Mises.

490
00:50:04.300 --> 00:50:10.140
I mean, they were very emphatic about it, that they got their basic ideas from Ludwig

491
00:50:10.140 --> 00:50:11.140
von Mises.

492
00:50:11.140 --> 00:50:16.180
In my case, it was somehow different.

493
00:50:16.180 --> 00:50:24.100
I believed so many young people on the right, that was anti-capitalist and anti-socialist

494
00:50:24.100 --> 00:50:28.380
at the same time, there must be a third way.

495
00:50:28.380 --> 00:50:32.620
But there ain't no such animal, you know?

496
00:50:32.620 --> 00:50:34.180
is no third way.

497
00:50:34.180 --> 00:50:40.060
In other words, we have to look towards free enterprise, I usually don't use the word capitalism,

498
00:50:40.060 --> 00:50:47.420
I say free enterprise, or free market economy, because actually Bolshevism is also capitalism,

499
00:50:47.420 --> 00:50:52.620
only state capitalism or private capitalism, that's the whole difference.

500
00:50:52.620 --> 00:51:00.340
So we have to look at these differences, but certainly therefore, if you take the teaching

501
00:51:00.340 --> 00:51:07.100
The teaching role which Ludwig von Mises had, I think the teaching role he set in this world

502
00:51:07.100 --> 00:51:09.140
is something permanent.

503
00:51:09.140 --> 00:51:12.980
He's something permanent.

504
00:51:12.980 --> 00:51:17.980
He was not a man of my faith.

505
00:51:17.980 --> 00:51:25.260
Hayek was more or less an agnostic, both respected the Catholic faith, probably more than anybody

506
00:51:25.260 --> 00:51:43.100
Hayek wanted a Catholic funeral, and the funeral speech was held by a Jesuit whom I know, Shashynk,

507
00:51:43.100 --> 00:51:50.940
but who was not an ordinary Jesuit, he was a specialist in economics.

508
00:51:50.940 --> 00:51:58.420
So he had the funeral oration at his burial in Freiburg in Breisgau, but let us finally

509
00:51:58.420 --> 00:52:10.500
honor the memory of Mises, who was a fine man and a real character, a real character.

510
00:52:10.500 --> 00:52:14.060
And as a real character, he remains in my memory.

511
00:52:14.060 --> 00:52:43.060
Thank you so much.

512
00:52:43.060 --> 00:52:47.360
64,000 dollar questions, I'm expecting.

513
00:52:47.360 --> 00:52:52.740
I won't pay them to you, but I would like to, yes, please.

514
00:52:52.740 --> 00:53:00.020
I'm not aware of the 1961 split, and then I thought also, can you explain a little more

515
00:53:00.020 --> 00:53:01.020
about that?

516
00:53:01.020 --> 00:53:10.140
Yeah, that is very difficult because there were personal reasons, the loyalty of Röpke

517
00:53:10.140 --> 00:53:19.460
to the then secretary, not the president, the secretary, called Honnold, but actually

518
00:53:19.460 --> 00:53:34.060
it was also the fact, I would say that, you know my one, two, three, four stages of liberalism,

519
00:53:34.060 --> 00:53:42.460
That the old liberals really harked back purely to Adam Smith, whereas the neoliberals harked

520
00:53:42.460 --> 00:53:47.220
back, in other words, three to one and four to two.

521
00:53:47.220 --> 00:53:52.540
That means the neoliberals really harked back to the early liberals.

522
00:53:52.540 --> 00:53:59.200
They helped them, and they then forget that the early liberals had a very distinct religious

523
00:53:59.200 --> 00:54:10.040
is coloration, and Menlaib Röpke, now even Rüstow, who is a real giant, I'm afraid that

524
00:54:10.040 --> 00:54:17.120
you probably know hardly anybody if you know much about Rüstow, who was a neoliberal.

525
00:54:17.120 --> 00:54:23.800
He has a son in America, I think he teaches John Hopkins, who published that more new

526
00:54:23.800 --> 00:54:32.600
mental work of Rüstow, orstbestimmungtegegenwart, difficult to translate, effort to establish

527
00:54:32.600 --> 00:54:40.000
the momentary moment in our history in three large volumes with an enormous material.

528
00:54:40.000 --> 00:54:51.540
And Rüstow, immensely close friend of Röpke, also with an agnostic, but with enormous admiration

529
00:54:51.540 --> 00:55:00.540
for the Catholic Church, a very interesting person, son of a Prussian general who became

530
00:55:00.540 --> 00:55:08.340
an anarchist and then was saved from starvation by a famous Catholic priest who also was a

531
00:55:08.340 --> 00:55:15.540
literary person who provided him with a bed and a typewriter and a chair and a table and

532
00:55:15.540 --> 00:55:22.700
paper and so on, who then emigrated to Constantinople, so did Röpke.

533
00:55:22.700 --> 00:55:29.620
Röpke and Rüstow were both in Constantinople, but then Rüstow stayed in Constantinople

534
00:55:29.620 --> 00:55:31.340
and Röpke went to Geneva.

535
00:55:31.340 --> 00:55:35.460
Röpke spent the war years in Geneva.

536
00:55:35.460 --> 00:55:41.580
Röpke also wrote a memorandum for the Allied powers to restore the monarchy in Germany

537
00:55:41.580 --> 00:55:44.740
after the war.

538
00:55:44.740 --> 00:55:48.220
And they did not go to America.

539
00:55:48.220 --> 00:55:57.460
In other words, they wanted to stay as close as they could to the frightful center of infection,

540
00:55:57.460 --> 00:56:01.020
which was the heart of Europe.

541
00:56:01.020 --> 00:56:06.740
Now you see, in other words, it is the anti-mammothism.

542
00:56:06.740 --> 00:56:13.980
I think I already used the expression of the neo-liberals which bothered.

543
00:56:13.980 --> 00:56:20.320
Mises said, Mammothism is perfectly avoidable.

544
00:56:20.320 --> 00:56:26.620
We need no state intervention, in other words, antitrust laws or anything of that order.

545
00:56:26.620 --> 00:56:31.500
Of course, at the same time, I can assure you, a man like Röpke would certainly not

546
00:56:31.500 --> 00:56:40.100
have approved of the specifically American antitrust laws, who to him seemed often very,

547
00:56:40.100 --> 00:56:49.380
very silly, and as you probably also realize, but he wanted to keep the idea, his idea was

548
00:56:49.380 --> 00:56:52.380
keep competition open.

549
00:56:52.380 --> 00:56:57.340
And of course, if nobody else can do it, well, we must rely on the state to keep competition

550
00:56:57.340 --> 00:56:58.340
open.

551
00:56:58.340 --> 00:57:09.420
There is nobody else who can assure that, which was denied by Hayek and denied by Mises.

552
00:57:09.420 --> 00:57:15.300
That is the main, I think that was really the main ideological difference between the

553
00:57:15.300 --> 00:57:16.300
two.

554
00:57:16.300 --> 00:57:17.300
Other questions, please?

555
00:57:17.300 --> 00:57:18.300
No one.

556
00:57:18.300 --> 00:57:19.300
Yes, please.

557
00:57:19.300 --> 00:57:37.300
The book of 1919, Mises was very much a Democrat, and he sort of ridiculed on the hereditary monarchies.

558
00:57:37.300 --> 00:57:53.300
He regretted that democracy couldn't really gain hope in Prussia and in Austria, but he blundered on the mix-up of different nationalities all living together in the same territory.

559
00:57:53.300 --> 00:58:02.300
But he thought that in countries where you could have democracy, well of course the people would vote for the policies, but that's not their issue.

560
00:58:02.300 --> 00:58:15.060
The change came about through history.

561
00:58:15.060 --> 00:58:23.460
You see history took all these nations of Central Europe over their knees and spanked them.

562
00:58:23.460 --> 00:58:31.220
And I felt this so vividly about four years ago, the pan-Europe union, you must know the

563
00:58:31.220 --> 00:58:39.780
The Pan-Europe Union is a private organization founded by Count Kudenhof Kalerje in the 1920s,

564
00:58:39.780 --> 00:58:46.060
and that is really the source and the father of the present tendency, no, tendency, I mean,

565
00:58:46.060 --> 00:58:50.180
it's the flow now to unite Europe.

566
00:58:50.180 --> 00:58:58.420
And in 1900, and I must pinpoint that, no, in 1993, yes, yes, four years ago, in Prague

567
00:58:58.420 --> 00:59:01.420
We had a great meeting, the Pan-Europe Union.

568
00:59:01.420 --> 00:59:10.420
I spoke, I read speeches in a variety of languages, I don't master at all, but I'm a very good parent.

569
00:59:10.420 --> 00:59:15.420
And then spoke Otto, the oldest son of the last emperor.

570
00:59:15.420 --> 00:59:19.420
And there the Czechs gave him a standing ovation.

571
00:59:19.420 --> 00:59:21.420
They had experience.

572
00:59:21.420 --> 00:59:29.900
First the corrupt republic, and then the Nazi rule, and then the communist rule, and they

573
00:59:29.900 --> 00:59:35.500
had bitterly learned the lesson, at least the people who were there.

574
00:59:35.500 --> 00:59:41.300
Now the standing ovation would have been unthinkable 100 years ago or 50 years ago.

575
00:59:41.300 --> 00:59:47.540
In other words, history also taught Mises.

576
00:59:47.540 --> 00:59:54.980
And I've changed my mind also because I actually, in my novel called Gates of Hell, I have three

577
00:59:54.980 --> 00:59:59.460
pages in a novel against capitalism.

578
00:59:59.460 --> 01:00:09.580
But I got the good education by Röpke, Röpke took me by the ear and converted me to free

579
01:00:09.580 --> 01:00:10.580
enterprise.

580
01:00:10.580 --> 01:00:14.580
Now that was very obvious in the case of Mises, yeah.

581
01:00:20.580 --> 01:00:22.580
Anybody else?

582
01:00:22.580 --> 01:00:24.580
Anybody else?

583
01:00:24.580 --> 01:00:26.580
Yes?

584
01:00:26.580 --> 01:00:28.580
This is a small question.

585
01:00:28.580 --> 01:00:36.580
Did Mises continue as the financial advisor in the Khrushchev regime or not?

586
01:00:36.580 --> 01:00:58.660
Yes, also he continued with Mises, but only until 1936, because by 1936 he realized in

587
01:00:58.660 --> 01:01:06.460
all likelihood that Austria was lost, that Austria had lost its protection in Italy, because

588
01:01:06.460 --> 01:01:12.180
Because Italy had been driven into the arms and, of course, to save his skin.

589
01:01:12.180 --> 01:01:19.300
Unlike Freud, Freud, for instance, who was also, I mean, if you like, a supporter, very

590
01:01:19.300 --> 01:01:26.100
much an anti-democrat, Freud, never forget, and politically was a man of the right.

591
01:01:26.100 --> 01:01:34.180
Freud was a man who, as a man who admired Christianity, I mean, he was against promiscuity

592
01:01:34.180 --> 01:01:44.300
Jean Freud was terrified about the idea that his theories might fall into the hand of psychiatrists,

593
01:01:44.300 --> 01:01:50.940
because he said, I mean, the treatment of people for years and high expenses perfectly,

594
01:01:50.940 --> 01:01:55.820
it should only be used for the education of children and for cultural analysis.

595
01:01:55.820 --> 01:01:56.820
That was Freud.

596
01:01:56.820 --> 01:02:01.860
But the people are very often misunderstood what they're after.

597
01:02:01.860 --> 01:02:10.780
But then, of course, he went over to Geneva and kept up his connection with the Handelskammer,

598
01:02:10.780 --> 01:02:13.060
that is the Chamber of Commerce.

599
01:02:13.060 --> 01:02:19.980
And in the Chamber of Commerce, he collected young people, young and old people, no, no,

600
01:02:19.980 --> 01:02:26.540
people and men and women, and held seminars in the Chamber of Commerce.

601
01:02:26.540 --> 01:02:28.400
It was a very important thing.

602
01:02:28.400 --> 01:02:34.200
But he never got really the full professorship of Vienna, but he got the title of professor.

603
01:02:34.200 --> 01:02:42.080
He was a very highly prized professor in Europe, he's a man who can only be compared in prestige

604
01:02:42.080 --> 01:02:48.060
with diplomacy or with the general staff.

605
01:02:48.060 --> 01:02:55.000
He got it from the emperor, from Francis Joseph, made him professor, Freud, I'm speaking about

606
01:02:55.000 --> 01:02:56.000
Freud.

607
01:02:56.000 --> 01:03:05.000
And the role of Mises was only that of, well, you could say, by American standards of an

608
01:03:05.000 --> 01:03:06.000
assistant professor.

609
01:03:06.000 --> 01:03:09.000
He didn't get the full professorship.

610
01:03:09.000 --> 01:03:20.560
I mean, he was treated badly by the University of Vienna as, finally, by the universities

611
01:03:20.560 --> 01:03:22.920
in this country here.

612
01:03:22.920 --> 01:03:30.080
He had to swim always against the current, but he swam courageously.

613
01:03:30.080 --> 01:03:32.960
That's the wonderful thing about him.

614
01:03:32.960 --> 01:03:34.640
He never gave in.

615
01:03:34.640 --> 01:03:38.040
He fought his noble fight.

616
01:03:38.040 --> 01:03:41.040
Other questions?

617
01:03:41.040 --> 01:03:45.880
Nobody, nobody.

618
01:03:45.880 --> 01:03:50.720
Well, I think I have to thank you then for your attention.

619
01:03:52.920 --> 01:03:54.920
Thank you very much.