I don't know whether I'm going to stand up all the time or not, but I'll start out standing, because I can see you all better. Thank you.
I was fortunate to know Mises and to know him pretty well, and I attended his seminar at NYU for 18 years.
I'm now, I took shorthand notes, I'm now typing them up and I typed them in the 70s and I'm now putting them on the computer.
I brought them down on a tiny little flash bulb like that and Judy out here put them in the flash bulb and in an instant transferred them to her computer.
I don't understand all this that's happened because of capitalism, I guess you just have to say.
You know, the world, everything that happens in the world is done by people,
I mean, except out of nature and so forth and so on.
Everything that we have in the world today is, if you can describe it,
I describe it as the result of people acting using what they had to get what they want.
All the changes from the caveman to the computer is because of what individuals did.
Each one acting, trying to accomplish something he wanted, trying to achieve some personal end.
I'm talking about their peaceful actions, not their wartime militant or robbing or burglary,
but their peaceful actions is the result.
Everything we have today is the result of how people acted purposely to attain some particular end and goal
and improve their situation in one way or another.
And this is how we got from the cave to the computers.
But now I want to talk to you now about Mises' human action.
Mises was a young man in Austria-Hungary in 1981.
And he was a good student, I'm sure.
But he wasn't particularly interested in economics.
He thought he would study law.
And then he read Menger's Principles of Economics,
Brünnsatz in Nationale Komune.
And he said that book made an economist of him.
Because that book showed him that it was not just because people did things
and that certain things happened in history, but there was a reason and a principle about the way these things came together.
There was, I don't know whether you can say, like economic laws, there were like physical laws, like the law of gravity,
but there were principles and laws in the field of human action that could no more be violated than the law of gravity.
If you interfere with the voluntary actions of people on the basis of their values, you disrupt economic relations, you disrupt trade, you disrupt production.
There are principles behind this whole thing.
So after he read Menger's book, he began thinking of economics, not just studying the history of economics, but studying the principles behind it.
And he said that, as I say, I think he was a very good student.
And when he wrote a book about, or an article, made a study about housing in Austria or Vienna,
which was government housing at that time, then he realized that there was government intervention
interfered with the principles of economics, and he became against government intervention.
He never was a socialist or a communist, which I guess for the ideas going around in the
university of his day, but he might have been a German historicist, or I guess you might
call him a positivist, but he was never a communist or a socialist, but it was Menger
that made him realize that there was a science outside of history.
There was a science of how things came about on the market.
So he turned toward the study of economics, and he studied money.
Now, you heard here about how money comes into being
From individuals on the market who want to trade, they can't, they have nothing to exchange for what they want immediately and directly, and they finally, by a process of trading with one another, they finally, and they don't do this purposely and consciously necessarily.
But when they're trying to exchange something, they realize that they can choose something
that's more marketable than what they have and then use that later in another trade and
in the meantime by this process of two trades, they can acquire what they want.
This means they conceive of the prospect of developing an intermediate medium of exchange
and they settled after countless trades and exchanges throughout years, centuries perhaps,
on using gold and silver as this medium of exchange.
It didn't come about by planning.
It came about by individuals, each one acting and trading one with another
and gradually narrowing this medium
that they were going to use in trade
down to gold and silver.
That was how money came into being
and I'm sure you've heard about that this week
with learning about human action.
And so in 1912, Mises wrote a book about money.
His first thought was that he should start
with this development of money as a medium of exchange,
out of bar, actually.
And then, but he had enough understanding
of what was going on in the world in 1912
to know that war was brewing in Europe.
And so he started his theory of money and credit
with money as a medium of exchange,
Goal as a Medium Exchange and that was the book on Theory of Money and Credit that is now available.
It was he revised the 1912 edition and later but that was what came out in 1920 and in 1920 he said
if the value of the German mark should depreciate so much that it was one one hundredth of its
If there was this value at that time, the market would have to find another medium of exchange.
It was right about one prediction, but not in the degree to which the money would have to exchange.
You know, the German mark, and I'm sure you've heard, in 1923 became one-four billionth with a B
before it was finally discarded as a medium of exchange.
So he was right in his prediction but not in his degree.
He says you cannot predict quantity.
You can't anticipate quality of change.
Well, so his book on money came out in 1912.
and then he had been, had compulsory military service in Austria-Hungary when he was a young man
and he had become a lieutenant, had served his year or so of duty and was not in the army or in the military at all from 1910 or so.
So he'd finished his year of duty, but then of course the war started in 1914 and he was called back to duty and he served on the Russian front.
He was finally wounded and sent back to Vienna, you can imagine, wounded on a bumpy, I don't know, horse and wagon or something and finally to a train
and then to Vienna where he was in the hospital and I don't know for how long but he recovered and he didn't have to go back. The war wound up without time.
So he then went to work as, I guess you might say, an advisor to the government. He did work for the government. It was the Austrian-Hungarian government.
But he also lectured at the University of Vienna as a, what they call a Privatdozent.
He was a lecturer, but an unpaid lecturer, a volunteer like some of the volunteers we have around here.
And he lectured there, I guess from 1914 until he left Vienna finally.
But he also thought that thetalk with the world, he knew there were a lot of problems because by this time he had a pretty good understanding of the problems with government and government intervention.
And so he wrote books, he wrote socialism, which you folks all know, socialism, and that came out in 1922.
1932. Then he revised his money book in 1934. He wrote, he put into a book several articles
that he had written on epistemological problems, on ideas, on theories, on praxeology, on the
theory of action and so forth. And then liberalism, which was of course the opposite of interventionism
and the Opposite of Socialism and Control.
And another book was published on critique of interventionism, which was again a critique
of the government policies that they had at that time.
And then he went, in 1934 he had a chance of going to Switzerland to teach.
Now, he didn't know what was happening, he couldn't forecast, but he could anticipate
because he had an understanding of what was going on, and he realized that Austria-Hungary
was heading down, he was against, away from any kind of freedom and so forth, and so he
left and took this position in Geneva.
He continued to go back and forth between Geneva and Switzerland and Vienna and he took
this time in Geneva to write the book that he hadn't really written because he'd been
working on special angles of the market economy and he thought there needed to be a book that
dealt with the whole thing overall, like Human Action, but this of course it wasn't Human
and Action, but it was called Nazional Economy, which somewhere I saw the title around, oh,
it was one of the books in the library, Nazional Economy, he wrote, covering the whole realm
of human action, starting with action and explaining how the laws arise out of the subjective
of Values of Individuals, how this individual is choosing from one thing to another, trying
to accomplish their various goals personally and individually, using what they have to
get what they want, and by voluntary techniques, trading, exchanging, communicating, and out
All of this arises, the economy, and he had the time when he was in Geneva because he
wasn't working for the Austrian government anymore.
He had been an advisor, well I don't know whether you'd call him a bureaucrat, but
he was an advisor to bureaucrats, I guess, and analyzing the economic consequences of
and the various laws and proposals that were made in the government.
But when he was in Vienna, I mean Geneva, he didn't have this responsibility only,
only had to teach one hour a week and gave two seminars a week.
And this gave him the time to write National Economy.
And that covered the whole gamut of economic science.
Now, he showed that economics was not just history.
There were principles and laws behind it.
And this is what he tried to do in not-to-know economy,
to show how individuals' subjective values lead them to value some things more than another
and this creates the price system, the prices, and this tells entrepreneurs what to do.
And the entrepreneurs study prices and they study or try to anticipate consumer demand.
The whole economic system that we have today, as I say, is the result of individuals each acting on their own,
trying to use what they have to get what they want and to follow their ideas.
So the whole market is the result of action plus ideas.
There are principles that guide these, that result from these actions.
Principles, the marginal utility, as I say, the whole thing starts with value.
And because people have values, they value one thing more than another, this makes it more expensive, more gives it a higher price and value in the eyes of other people.
of People, and because as competition these prices are all interrelated, and these interrelations,
you might say, are the economic principles, but the ideas that people have, they tell
Tell them to work in one area or produce in another or to not work or to prove more or
to less. These ideas you cannot predict. They're completely under-predictable and you can't
predict what will happen but you can anticipate the principles on which they'll be working.
Well, now, Mises went to Geneva to work, and he continued to travel back and forth to Vienna,
and he had met Margaret Serrini, her name was, and they continued to see each other,
and finally on his visit in Christmas and New Year's, 38 to 9, he proposed.
And he went that evening to visit one of his former students, Morgenstern, never mentioned
anything about a girlfriend or a fiancé or anything else, and went back to Geneva, never
mentioned to the Morgensterns, and went back to Geneva.
And then it was in March of 1939 that Hitler came in.
Margaret telegraphed Mises that his friends had arrived in Vienna, and he shouldn't come back,
but he said for her to come to Vienna, to Geneva, which she did, and they got married then.
And he was at that time, as I say, working on the national economy.
She didn't type it, but she did proofread it, and finally, but then the situation in
Germany was getting so bad, friends and associates of his said he should move to the United States.
They got him a visa as a refugee, and so they made plans to leave Geneva, and two days before
Before they were supposed to leave, Mises' Nationale Economie was published.
This big book that he'd been working on for almost 10 years or more and thinking about
for more came out.
And if any of you have published books, you know it's always an important event when
it finally comes out and gets into print.
And here he was, this big fat book, teaching the dangers of interventionism, the dangers
Years of government interference and in a world where there was nothing else but government
interference and Nazism all over everywhere.
And he had two days after the book came out, he left Vienna, I mean Geneva, he and several
other refugees traveled by bus across Switzerland, France, Spain, and then Portugal.
And finally they got shipped to the United States.
In the United States Mises arrived with practically nothing, he had to leave all his furniture
and everything behind.
He did have his books shipped when he came to the United States without any prospects
or something, but some of his friends said they had a job for him in California.
But then this contact in California met him and said, yes, we offered you a job in order
to be able to get you a visa, but there isn't any job.
If you come, we'll give you work, but we really don't have a place for you.
So he decided to stay in New York, and there he contacted the Rockefeller Foundation that
that he'd been in touch with before and whose several students of Mises had come to the United States on Rockefeller fellowships and they made it possible for him to write.
This was 1940 when he came to this country. They made it possible for him to write bureaucracy which came out in 1944 and then epistemological problems in 1944.
One of the contacts he had in this country was Henry Hazlitt, whom he had never met.
But Hazlitt had written a review of socialism, I guess it was, in the New York Times.
And so he contacted Henry Hazlitt, and Hazlitt then helped him in many ways.
I think Hazlitt helped him get Yale University to publish bureaucracy and epistemological
problems and then Hazlitt said we should have national economy translated. Mises says no
it shouldn't be translated, it should be written in English for an American audience. So he
When he set to work, and it must have been six years or so, he worked more or less translating
his German book, Not Your Null Economy.
The chapter headings are very similar, but he was really rewriting it.
If you know, if you do any translation, I'm going to sit down.
If you do any translation, you really have to write it anew.
You have to understand what it says in the first language and then write it in the new language.
You can't do it word for word. It sounds very funny if you do.
So he rewrote Human Action. He had a young high school teacher who taught in the business school
to help him with his English and he would come every week or so and Mises would have several
paragraphs or a chapter written out in English and they would work over the English and work it all
and finally, in 1949, Mises finished. Now I might say that Mises in Vienna had, of course, he'd written books, specialty books on intervention, socialism and so forth and so on,
But he also was continually studying the general overall subject of human action, the science of human action,
how the actions of individuals, on the basis of their own values, working for their various ends,
develop these principles on which the economy develops.
And he had his main outlet for discussing his general ideas was a private seminar he held outside the university.
And many of these people were young students and they just came, you might say, for fun in the evening and they wrote serious papers.
They were people who, many of them, Mises arranged to have fellowships under the Rockefeller Foundation in this country.
And many of them, following Mises, I won't say advice, but his reasoning, because of his understanding of what was going on in the world,
got jobs coming to the United States.
There was Oscar Morgenstern, Fritz Machlöck. Fritz Machlöck was one who was very close to Mises, and they used to walk from the university to the Chamber of Commerce where Mises worked and taught, and so he was sort of a confidant of Mises.
He was at that time in the furniture business. His family had a furniture business and he
was a businessman but he was studying economics and he became a very close friend of Mises.
And he also got a fellowship under the Rockefeller Foundation thanks to Mises and then finally
moved to this country and was one of the persons who helped Mises get a chance of coming here
as a Refuge when the war broke out. And he was also one of the persons who suffered from Mises' temper.
Mrs. Mises tells the story at one of the Mont Pelerin meetings.
Markle was talking something about money, I think, but something that Mises felt was a complete betrayal
of what he had taught about money being a medium of exchange and shouldn't be
inflated by government. And Mises walked out of that meeting on that account too
and said to Mrs. Mises, we're leaving, Max Machlop knows better than that.
Some years later, Mises managed to get, Mrs. Mises managed to get Mises to, I don't know, say apologize, but meet with Markler, and I think they ended up friends, but Mises did have a temper.
Hobbler was another one who came on a Rockefeller scholarship, and there were others, I can't remember their names.
Well then, after some years, Mises came to this country in 1940, and 1949, probably when Human Action came out,
He arranged to have a seminar at New York University, but as someone was telling me,
New York University didn't pay his salary, it was privately paid, the Volcker Fund paid
his salary. He was a recognized economist, people knew him all over the world, and they
They were, I think, a little afraid of him because he was so firm and not compromising
in his discussions and books and so forth and so on.
And the universities didn't want to hire him, but the Volcker Fund paid him enough.
So he started teaching two nights a week, a seminar and a lecture course.
And among the students that came to that seminar was Murray Rothbard.
Now Murray Rothbard had studied at Columbia and was getting a doctorate at Columbia University.
And he was attending Mises' seminar when Human Action came out.
And Murray Rothbard asked him what it was about.
And Mises is everything.
And I guess it is, it's about everything.
And Murray was an active participant in that seminar.
I started in 1951, and I think Rothbard started in 1949 before I went.
But Mises realized that Rothbard was an anarchist.
Mises was not an anarchist, and I don't think they argued, I'm sure they didn't argue because
Mises wouldn't argue or debate, but Mises revised and added a few paragraphs to the second
edition of Human Action in the attempt to answer Rothbard's argument. Now I don't know
I know what you all have heard about Rothbard, and I understand from the hands that were
raised when Walter was talking that most of you call yourselves anarcho-capitalists. But
I think the three pages or so that Mises added to Human Action, second edition, which Rockwell
did not reprint, are very good. He says that the market is a voluntary system of trade
and Exchange, and so forth and so on. And that if there are disruptions, the market
can't survive. The market needs peaceful protection of private property and life. And now, Rothbard
says that because the market can do so many things, the market can operate the justice
Maybe he's an idealist. Perhaps Mises is an idealist too. He says that some agent needs to protect life and property and permit the market to operate, not to operate the market, but to permit the people to trade in exchange without the threat of violence and interference with their activities.
to operate the market but to permit the people to trade and exchange without the threat of
violence and interference with their activities. And perhaps Mises was an optimist to think
that government wouldn't exceed its power and authority. But that was, I don't know
whether, who was, Peter Klein was talking that if two praxeologists disagree they can
Mises and Rothbard didn't fight, but Mises wrote books and that's what he said. You have
to change the ideas of people. So he tried to change, and he did change, human action
with, I think, three or four or five good paragraphs, what pages, talking about why
the market needs peace and that it needs a government to protect that peace.
So when Mises wrote these extra pages, Yale University put out a second edition of Human
Action.
I'm supposed to be talking about the book, Human Action.
So Mises added these pages and Yale University printed a second edition.
But the personnel at Yale University had changed.
The personnel that published bureaucracy and epistemological problems and the first edition
of Human Action had all left Yale University and what the new officers at Yale thought
or believed, I have no idea and I don't know who they were, but that second edition of
The Theory of Human Action was a lousy print job. There were dark paragraphs in print and light paragraphs.
There was one page omitted, a whole page omitted, and one page repeated twice.
And Mises, as I said before, if you'd rather rent a book, it's like a baby, you want it to come out perfect.
And here was his effort of umpteen years, demolished or destroyed or mutilated, is a better word.
And he wanted to sue, but the lawyers told him you can never win a case against Yale University in New Haven, Connecticut, which was Yale's hometown.
so he gave that up and eventually some
friends of Mises got permission from Yale University to put out a
reprint of the second edition but a good reprint and that came out
in sixty-six
what?
in sixty-six, yes
by Regnery Press
and then it was reprinted by the foundation again in 96 and now Liberty Funds put out a new edition
and when Rockwell wrote me and asked me this was after Mises died and I had inherited the
copyright rights to Mises books for permission to do the first edition I said yes but I didn't
I didn't realize, and I don't know why he wrote it, wanted to reprint the first edition instead of the second edition, which was the one, I thought it was a tremendous tribute to Rothbard, a young student, for Mises to revise his major opus to take care of discussions and comments that Rothbard had had.
So anyway he reprinted the first edition and calls it the scholar edition and that's the
one you've read.
So maybe Rothbard was an optimist in thinking that if you had no government you could still
have peaceful society and Mises an optimist in thinking that if you had a government to
protect life and property you could maintain a peaceful society without having government
and Exceed its proper role.