Abstract: George Reisman’s magnum opus Capitalism: A Treatise on Economics is a monumental attempt at theoretical integration of leading economic phenomena into one unified whole. Few such books have been published in the history of economics. Still fewer of them contain a comparable proportion of path-breaking innovations both in approach and substance that are integrated in a tightly-spun system of thought that Capitalism does. Yet despite its numerous path-breaking contributions to economic theory, the book has attracted virtually zero attention from the scientific community. History shows that for the most part this has been the fate of all great innovations in science. This review attempts (a) to point out reasons why the book’s content is revolutionary, and (b) to finally start a serious discussion of its substantive ideas. Specifically, the review focuses in some detail on some of Reisman’s most important innovations which all point the way to a wholly new direction in economic theory that promises to provide the hitherto unseen conformity with empirical reality, analytical rigor, and doctrinal integration.
Abstract: Anthony de Jasay is among the most important social thinkers of our time. His oeuvre offers a sustained critique of government and its defenders. In the book Ordered Anarchy: Jasay and His Surroundings, colleagues and friends pay tribute to the man in the form of an inspiring collection of essays.
Download Paper: “Review of Ordered Anarchy: Jasay and his Surroundings”
Market anarchists are often keen to know how we might rid ourselves of the twin evils institutionalized in the state: taxation and monopoly. A possible future history for North America is suggested, focusing upon the implications of the establishment of a subscription-based patrol and restitution business sector. We favor Rothbard over Higgs regarding crises and liberty. We favor Barnett over Rothbard regarding vertical integration of security. We examine derived demand for adjudication, mediation and related goods; and we advance the thesis that private adjudication will tend to libertarianly just decisions. We show how firms will actively build civil society, strengthening and coordinating Nisbettian intermediating institutions.
Abstract: The libertarian first principle—a belief in individual freedom—can lead to two different and not necessarily acceptable societies from the standpoint of liberty. One is the “Union of Liberty,” in which communities, associations, and intermediate bodies are held to rigorous standards of voluntariness (and thus face sharp limits on their internal associational freedom because of the knowledge that children will be born into them). In the other, the “Federation of Liberty,” they are not (thereby allowing children to be born into locally unfree environments).
While in any free society individuals may voluntarily join together and waive some of their rights (in institutions such as contract or marriage, for example), hard questions arise when nonconsenting children are born into restrictive environments that their parents may have voluntarily created. An adult who gives up all of his or her property to a communal religious body upon conversion has made a voluntary choice, but what about the child born into that religious community later on? Thus, the Federation of Liberty can, in theory, turn out to contain no communities that actually value or respect liberty; and even slavery might have a lawful place within it. The Union of Liberty, on the other hand, can, in principle turn out to be society ruled by a strong authority with little respect for dissenting moral traditions, including some self-styled libertarian moral traditions.
Libertarians face a stark choice between these “two constructions of libertarianism”; there is no third way, theoretically speaking. Libertarians must choose one of them. Given the necessity to choose one of these constructions, the Federation of Liberty is arguably preferable to the Union of Liberty.
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Abstract: In his Studies in Philosophy, Politics and Economics (1967, p.168), Nobel Prize laureate Friedrich A. von Hayek explains that “from the first establishment of (trade) which served reciprocal but not common purposes, a process has been going on for millennia which, by making rules of conduct independent of the particular purposes of those concerned, made it possible to extend these rules to ever wider circles of undetermined persons and eventually might make possible a universal peaceful order of the world.”
Today, we can denominate this the process of globalization, understanding as such the process that arises spontaneously in the market and acts by developing a progressive international division of labour, eliminating restrictions on individual liberties, reducing transportation and communication costs, and increasingly integrating the individuals that compose the “great society.”
The purpose of the present essay is to attempt to deepen in this Hayekian thesis and approximate an explanation of why the said process could lead to world peace. To be consistent with Hayek’s works, we must conduct a multidisciplinary analysis of the process under consideration; analysis which must necessarily include a historical reference, an economic study, a legal approach, and finally the consideration of its cultural implications.
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Abstract: In this lecture delivered November 2008 on the occasion of the presentation of the Mises Institute’s Gary G. Schlarbaum Prize for lifetime achievement in the cause of liberty, Professor Salin discusses his discovery of Austrian economics and his involvement in “the world of individual liberty,” and draws various lessons from his intellectual journey. The coherence of Austrian economics appealed to Salin—it is not a patchwork of partial theories, but a logical process of thought founded on realistic assumptions about individual action. Salin also discusses differences between the Chicago and Austrian approaches, and his views about monetary systems.
The financial crisis beginning in late 2008 is not a crisis of capitalism, but of state intervention, caused by the expansionary monetary policy of the Fed. Capitalism is the solution, not the cause. There is no need to create money. There is never any balance of payments problem. What is required is tax systems more friendly to capital accumulation, a decrease in the role of the state, the end of monetary policy and, if possible, the disappearing of central banks and the IMF.
(Audio and video versions of the original speech may be found here. See also Guido Hülsmann’s article about the heroic Professor Salin, Pascal Salin: Gentleman, Economist, Radical.)
Abstract: The long stagflation in the nineteen-seventies broke the Keynesian hold on economic policy. Last year we witnessed the spectacular unraveling of neo-liberal policies of manipulating money and credit. While these episodes might be studied to explain the specific weaknesses and errors of each of the two policy paradigms that have dominated in the West after the Second World War, this lecture highlights the ideas and presuppositions that remained in place throughout the whole period. Despite the alliance that once existed between libertarians and classical liberals, on the one hand, and neo-liberals, on the other hand, the latter did not have sufficiently coherent conceptions of freedom and free markets to produce a true alternative for the Keynesian idea of a scientifically managed economy as a utilitarian and pragmatic approach to the utopian goal of the greatest happiness for the greatest number, i.e., complete well-being for all.
Download Paper: “Dead End Street Blues”
Abstract: In “Why Libertarians Should Reject Positive Rights,” Joshua Katz offers a critical response to the argument developed by Nicolás Maloberti in “Libertarianism and the Possibility of the Legitimate State.” In this rejoinder, Maloberti argues that Katz’s response fails on two accounts. First, it fails to grasp the nature of the problem his article was ultimately concerned with. Second, it fails to present a solid case for the rejection of the type of positive right that it was argued libertarians should endorse as a solution to that problem.
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Abstract: Maloberti, in “Why Libertarians Should Accept Positive Rights” argues that, as normally presented, libertarianism entails anarchism. He argues that libertarians should, therefore, accept a limited form of positive rights, which will allow for the creation of a libertarian government. In this paper, it is argued that the entailment of anarchism is not a problem for libertarianism, and that the form of positive rights endorsed by Maloberti is unfounded, ill-defined, and inconsistent with libertarian notions of individual freedom. It is further argued that Maloberti’s positive rights, as defined in his paper, cannot withstand the analysis prompted by Austrian value theory.
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Abstract: The classical formulation of libertarianism seems to be incompatible with the requirements of political legitimacy. Some libertarians have endorsed this result, denying that the state is legitimate. This paper argues, however, that the particular nature of that incompatibility represents a problem for the classical formulation of libertarianism. It is argued that acknowledging the existence of a particular minimal form of positive rights might overcome the problem in question. It is further argued that acknowledgment of such positive rights would seem to provide a more adequate normative ground for making sense of some central libertarian insights and concerns.
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Abstract: Interpretation of macroeconomic events in the 1930s and 1940s is complicated by the era’s institutional peculiarities, especially the massive work-relief programs during the Depression and the displacement of market-based pricing and resource allocation during the war. These difficulties can be avoided to some extent by examining hours worked, rather than such standard indicators as estimated real GDP and the rate of unemployment.
From such an examination, we may conclude that (1) the depression had a flat trough in 1932, 1933, and 1934; (2) civilian government hours accounted for three-eighths of the increase in total hours worked between 1932 and 1936; (3) as late as 1939, private nonfarm hours were 16 percent below their 1929 level and 21 percent below the trend high-employment level for 1939; (4) the tremendous mismatch between the increase in private hours worked and the estimated increase in real GDP from 1940 to 1944 calls into serious question the accuracy of the estimated increase in real output; and (5) substitution of lower-productivity workers for the higher-productivity workers being drained into the armed forces from 1940 to 1944 only adds to doubts about the reality of the estimated increase in real output during that period.
Abstract: The libertarian-individualist cause is at a critical crossroads. To have a successful revolution in the minds of men, we must learn from the Leninists what “revolutionaries” can do to advance their principles: nourish and increase the hard core with an “open center” and support specific political actions through auxiliary organizations, while avoiding “left-wing opportunism” and “right-wing sectarianism.” Historically, it was from the post-war libertarian outposts that FEE was able to build and galvanize such a hard core open center, with members even radicalizing one another. But FEE attempted to be more populist than scholarly, driving away scholars once they had “graduated.” The Volker Fund filled this gap to some extent; but has started to go the way of the Earheart foundation’s efforts—since the scholars selected were not radical enough to maintain an open center, the hard core has been weakening and dissolving. The libertarian cause should de-emphasize drastically popular fronts with the conservative right, it should nourish and construct the hardcore libertarian movement with some form or forms of nucleus or center, and it must emphasize libertarian scholars and intellectuals primarily.
Abstract: This memorandum was written at the request of Henry Hazlitt to provide Mises’s comments on and concerns about F.A. Hayek’s initial proposals for what became the Mont Pèlerin Society. Mises stresses that those who favor liberty and freedom and oppose totalitarianism must also oppose interventionism. The memo argues that those who fought and lost against the rising tide of totalitarianism at the turn of the 20th Century lost their battles because they settled for middle-of-the-road policies that conceded considerable ground to the socialists. The weak point in Professor Hayek’s plan is that it relies upon the cooperation of many men who are today’s middle-of-the-roaders. As interventionists, they may not be the hoped-for intellectual pioneers to inspire people to build a freer world.
Download Paper: “Observations on Professor Hayek’s Plan”
Abstract: It is widely thought that Robert Nozick’s views on rectification of past injustices are of critical importance to his theory of distributive justice, even perhaps justifying wholesale redistributive taxes in the present because of the undoubted injustices that have pervaded much past history. This essay undertakes to correct this impression—not mostly by disagreeing with Nozick’s claims, but nevertheless proceeding on basic libertarian theory. Of enormous importance is the role of putative innocents, who are defrauded by miscreants carefully covering their tracks so that these recipients have no reason to think they are buying stolen property. But of equal importance is simply that the duty to rectify past injustices is not comparable to the original duty to respect property rights in the first place.