Austrian Economics Quotes

It is easy to be conspicuously 'compassionate' if others are being forced to pay the cost.

He who is unfit to serve his fellow citizens wants to rule them.

It's not an endlessly expanding list of rights — the 'right' to education, the 'right' to health care, the 'right' to food and housing. That's not freedom, that's dependency. Those aren't rights, those are the rations of slavery — hay and a barn for human cattle.

Taxation is theft, purely and simply even though it is theft on a grand and colossal scale which no acknowledged criminals could hope to match. It is a compulsory seizure of the property of the State’s inhabitants, or subjects.

Every socialist is a disguised dictator.

Socialism is an alternative to capitalism as potassium cyanide is an alternative to water.

Emergencies” have always been the pretext on which the safeguards of individual liberty have eroded.

Whenever someone starts talking about 'fair competition' or indeed, about 'fairness' in general, it is time to keep a sharp eye on your wallet, for it is about to be picked.

Freedom is indivisible. As soon as one starts to restrict it, one enters upon a decline on which it is difficult to stop.

Deep pockets and empty hearts rule the world. We unleash them at our peril.

The worship of the state is the worship of force. There is no more dangerous menace to civilization than a government of incompetent, corrupt, or vile men. The worst evils which mankind ever had to endure were inflicted by bad governments. The state can be and has often been in the course of history the main source of mischief and disaster.

There can be no socialism without a state, and as long as there is a state there is socialism. The state, then, is the very institution that puts socialism into action; and as socialism rests on aggressive violence directed against innocent victims, aggressive violence is the nature of any state.

No man can rightfully be required to join, or support, an association whose protection he does not desire.

There's a huge swath of humanity that has developed verbal abilities to extract resources from guilt-ridden people. They used to be priests, and now they're leftists.

A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society.

It is in war that the State really comes into its own: swelling in power, in number, in pride, in absolute dominion over the economy and the society.

The safest way to make laws respected is to make them respectable.

Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime. Steal a fish from one guy and give it to another--and keep doing that on a daily basis--and you'll make the first guy pissed off, but you'll make the second guy lazy and dependent on you. Then you can tell the second guy that the first guy is greedy for wanting to keep the fish he caught. Then the second guy will cheer for you to steal more fish. Then you can prohibit anyone from fishing without getting permission from you. Then you can expand the racket, stealing fish from more people and buying the loyalty of others. Then you can get the recipients of the stolen fish to act as your hired thugs. Then you can ... well, you know the rest.

It was Thomas Edison who brought us electricity, not the Sierra Club. It was the Wright brothers who got us off the ground, not the Federal Aviation Administration. It was Henry Ford who ended the isolation of millions of Americans by making the automobile affordable, not Ralph Nader. Those who have helped the poor the most have not been those who have gone around loudly expressing 'compassion' for the poor, but those who found ways to make industry more productive and distribution more efficient, so that the poor of today can afford things that the affluent of yesterday could only dream about.

The paralysis of potential is essential to the manufacturing of victims.

Libertarians make no exceptions to the golden rule and provide no moral loophole, no double standard, for government.

If any man's money can be taken by a so-called government, without his own personal consent, all his other rights are taken with it; for with his money the government can, and will, hire soldiers to stand over him, compel him to submit to its arbitrary will, and kill him if he resists.

The free market punishes irresponsibility. Government rewards it.

Proponents of Austrian economics include the fringe economics blog Zero Hedge, which has confidently predicted two hundred of the last two recessions

I wonder how many such men in America would know that Communism, the New Deal, Fascism, Nazism, are merely so-many trade-names for collectivist Statism, like the trade-names for tooth-pastes which are all exactly alike except for the flavouring.

People and institutions that refuse to admit error eventually discredit themselves.

I will feel no guilt on shutting my door to those who didn't listen.

I define anarchist society as one where there is no legal possibility for coercive aggression against the person or property of any individual.

The struggle for freedom is ultimately not resistance to autocrats or oligarchs but resistance to the despotism of public opinion.

Free-market capitalism is a network of free and voluntary exchanges in which producers work, produce, and exchange their products for the products of others through prices voluntarily arrived at.

Producing laws is not an easier job than producing cars and food, so if the government is incompetent to produce cars or food, why do you expect it to do a good job producing the legal system within which you are then going to produce the cars and the food?

Money is not an invention of the state. It is not the product of a legislative act. Even the sanction of political authority is not necessary for its existence. Certain commodities came to be money quite naturally, as the result of economic relationships that were independent of the power of the state.

In proportion as you give the state power to do things for you, you give it power to do things to you.

The welfare of a people lies not in casting other peoples down but in peaceful collaboration.

The law is guilty of the evils it is supposed to punish.

The principle that the end justifies the means is in individualist ethics regarded as the denial of all morals. In collectivist ethics it becomes necessarily the supreme rule.

Taxation is the price we pay for failing to build a civilized society. The higher the tax level, the greater the failure. A centrally planned totalitarian state represents a complete defeat for the civilized world, while a totally voluntary society represents its ultimate success.

A man who chooses between drinking a glass of milk and a glass of a solution of potassium cyanide does not choose between two beverages; he chooses between life and death. A society that chooses between capitalism and socialism does not choose between two social systems; it chooses between social cooperation and the disintegration of society. Socialism is not an alternative to capitalism; it is an alternative to any system under which men can live as human beings.

But who would build the roads if there were no government? You mean to tell me that 300 million people in this country and 7 billion people on the planet would just sit around in their houses and think “Gee, I’d like to go visit Fred, but I can't because there isn’t a flat thing outside for me to drive on, and I don’t know how to build it and the other 300 million or 7 billion people can’t possibly do it because there aren’t any politicians and tax collectors. If they were here then we could do it. If they were here to boss us around and steal our money and really inefficiently build the flat places, then we would be set. Then I would be comfortable and confident that I could get places. But I can’t go to Fred’s house or the market because we can’t possibly build a flat space from A to B. We can make these really small devices that enable us to contact people from all over the word that fits in our pockets; we can make machines that we drive around in, but no, we can’t possibly build a flat space.

Conflict is not unavoidable. However, it is nonsensical to consider the institution of a state as a solution to the problem of possible conflict, because it is precisely the institution of a state which first makes conflict unavoidable and permanent.

Government should never be able to do anything you can't do. If you can't steal from your neighbor, you can't send the government to steal for you.

A valid contract requires voluntary offer, acceptance, and consideration.

Liberty should be understood as freedom from the government, specifically, freedom from the initiation of physical force by the government.

Once you understand the economics of the Austrian School and the philosophy of liberty in the tradition of Rothbard, you never look at anything – not the state, the media, the central bank, the political class, nothing – the same way again.

People are not embracing collectivism because they have accepted bad economics. They are accepting bad economics because they have embraced collectivism.

Society has arisen out of the works of peace; the essence of society is peacemaking. Peace and not war is the father of all things. Only economic action has created the wealth around us; labor, not the profession of arms, brings happiness. Peace builds, war destroys.

While liberals are in favor of any sexual activity engaged in by two consenting adults, when these consenting adults engage in trade or exchange, the liberals step in to harass, cripple, restrict, or prohibit that trade. And yet both the consenting sexual activity and the trade are similar expressions of liberty in action.

Moreover, in the system of criminal punishment in the libertarian world, the emphasis would never be, as it is now, on "society's" jailing the criminal; the emphasis would necessarily be on compelling the criminal to make restitution to the victim of his crime. The present system, in which the victim is not recompensed but instead has to pay taxes to support the incarceration of his own attacker — would be evident nonsense in a world that focuses on the defense of property rights and therefore on the victim of crime.

Entrepreneurial capitalism takes more people out of poverty than aid.

War has been the necessary and inevitable consequence of the establishment of a monopoly on security.

The military state is the final form to which every planned economy tends rapidly.

When people say 'let's do something about it', they mean 'let's get hold of the political machinery so that we can do something to somebody else.' And that somebody is invariably you.

Where there is commerce there is peace.

Laissez faire (in its full true meaning) opens the way to the realization of the noble dreams of socialism.

Without anarchy, there would be chaos.

The profit of the one is the profit of the other.

Have you ever noticed how statists are constantly “reforming” their own handiwork? Education reform. Health-care reform. Welfare reform. Tax reform. The very fact they’re always busy “reforming” is an implicit admission that they didn’t get it right the first 50 times.

Experience cannot beat logic, and interpretations of observational evidence which are not in line with the laws of logical reasoning are no refutation of these but the sign of a muddled mind (or would one accept someone’s observational report that he had seen a bird that was red and non-red all over at the same time as a refutation of the law of contradiction rather than the pronouncement of an idiot?).

It is be­cause freedom means the renun­ciation of direct control of individual efforts that a free society can make use of so much more knowledge than the mind of the wisest ruler could comprehend.

Nowadays the job of the judge is not to do justice. The judge is more of a functionary . He's like a civil servant whose job is to interpret words written down by another branch of the government, whether those words are just or not.

Freedom is the foundation for all wonderful things in life.

The essential quality of a market system, contrary to popular thinking, is not that it promotes greed; but rather, that it renders greed harmless.

Government programs didn’t arise because the people demanded them or because the free market was unable to provide needed services. They arose because the politicians found them to be a convenient way to buy votes with other people’s money, a convenient way to enlarge their own power, a convenient way to reward their political cronies, and a convenient way to keep people dependent on government.

What makes anyone think that government officials are even trying to protect us? A government is not analogous to a hired security guard. Governments do not come into existence as social service organizations or as private firms seeking to please consumers in a competitive market. Instead, they are born in conquest and nourished by plunder. They are, in short, well-armed gangs intent on organized crime. Yes, rulers have sometimes come to recognize the prudence of protecting the herd they are milking and even of improving its ‘infrastructure’ until the day they decide to slaughter the young bulls, but the idea that government officials seek to promote my interests or yours is little more than propaganda—unless, of course, you happen to belong to the class of privileged tax eaters who give significant support to the government and therefore receive in return a share of the loot.

Socialism is not really an option in the material world. There can be no collective ownership of anything materially scarce. One or another faction will assert control in the name of society. Inevitably, the faction will be the most powerful in society -- that is, the state. This is why all attempts to create socialism in scarce goods or services devolve into totalitarian systems of top-down planning.

In spite of its alluring name, the welfare state stands or falls by compulsion. It is compulsion imposed upon us with the state’s power to punish noncompliance. Once this is clear, it is equally clear that the welfare state is an evil the same as every restriction of freedom.

When people encounter the free market and they recoil or react negatively to it, they're merely confessing that voluntaryism, trade and negotiation are foreign and threatening to them, which tells you everything about how tragically they were raised.

There is not the slightest analogy between playing games and the conduct of business within a market society. The card player wins money by outsmarting his antagonist. The businessman makes money by supplying customers with goods they want to acquire.

I was reading in the paper today that Congress wants to replace the dollar bill with a coin. They’ve already done it. It’s called a nickel.

Free markets are the real people's revolution.

Countries adopting free-market capitalism have increased output 70-fold, halved work days and doubled lifespans.

If any of the socialist chiefs had tried to earn his living by selling hot dogs, he would have learned something about the sovereignty of the consumers.

Government is a gang, but not merely as meritorious as a private gang because it claims legal legitimacy. It pillages and uses violence but under the cover of law, and seeks legitimacy not through competition but through the myth of the social contract.

Income inequality has no necessary connection with poverty, the lack of material resources for a decent life, such as adequate food, shelter, and clothing. A society with great income inequality may have no poor people, and a society with no income inequality may have nothing but poor people.

In particular, the State has arrogated to itself a compulsory monopoly over police and military services, the provision of law, judicial decision-making, the mint and the power to create money, unused land ("the public domain"), streets and highways, rivers and coastal waters, and the means of delivering mail...the State relies on control of the levers of propaganda to persuade its subjects to obey or even exalt their rulers.

Price controls almost invariably produce black markets, where prices are not only higher than the legally permitted prices, but also higher than they would be in a free market, since the legal risks must also be compensated. While small-scale black markets may function in secrecy, large-scale black markets usually require bribes to officials to look the other way.

In the natural sciences, some checks exist on the prolonged acceptance of nutty ideas, which do not hold up well under experimental and observational tests and cannot readily be shown to give rise to useful working technologies. But in economics and the other social studies, nutty ideas may hang around for centuries. Today, leading presidential candidates and tens of millions of voters in the USA embrace ideas that might have been drawn from a 17th-century book on the theory and practice of mercantilism, and multitudes of politicians and ordinary people espouse notions that Adam Smith, David Ricardo, and others exploded more than two centuries ago. In these realms, nearly everyone simply believes whatever he feels good about believing.

The appeal to the intellectually insecure is also more important than it might seem. Because economics touches so much of life, everyone wants to have an opinion. Yet the kind of economics covered in the textbooks is a technical subject that many people find hard to follow. How reassuring, then, to be told that it is all irrelevant -- that all you really need to know are a few simple ideas! Quite a few supply-siders have created for themselves a wonderful alternative intellectual history in which John Maynard Keynes was a fraud, Paul Samuelson and even Milton Friedman are fools, and the true line of deep economic thought runs from Adam Smith through obscure turn-of-the-century Austrians straight to them.

In regard to the so-called social contract, I have often had occasion to protest that I haven't even seen the contract, much less been asked to consent to it. A valid contract requires voluntary offer, acceptance, and consideration. I've never received an offer from my rulers, so I certainly have not accepted one; and rather than consideration, I have received nothing but contempt from the rulers, who, notwithstanding the absence of any agreement, have indubitably threatened me with grave harm in the event that I fail to comply with their edicts.

What ranks above all else for economic and political reconstruction is a radical change of ideologies. Economic prosperity is not so much a material problem; it is, first of all, an intellectual, spiritual, and moral problem.

The government enforces a monopoly over the production and distribution of its alleged 'services' and brings violence to bear against would-be competitors. In so doing, it reveals the fraud at the heart of its impudent claims and gives sufficient proof that it is not a genuine protector, but a mere protection racket.

Go into the London Stock Exchange – a more respectable place than many a court – and you will see representatives from all nations gathered together for the utility of men. Here Jew, Mohammedan and Christian deal with each other as though they were all of the same faith, and only apply the word infidel to people who go bankrupt. Here the Presbyterian trusts the Anabaptist and the Anglican accepts a promise from the Quaker. On leaving these peaceful and free assemblies some go to the Synagogue and others for a drink, this one goes to be baptized in a great bath in the name of Father, Son and Holy Ghost, that one has his son’s foreskin cut and has some Hebrew words he doesn’t understand mumbled over the child, others go to heir church and await the inspiration of God with their hats on, and everybody is happy.

Libertarians make no exceptions to the golden rule and provide no moral loophole, no double standard, for government. That is, libertarians believe that murder is murder and does not become sanctified by reasons of state if committed by the government. We believe that theft is theft and does not become legitimated because organized robbers call their theft "taxation." We believe that enslavement is enslavement even if the institution committing that act calls it "conscription." In short, the key to libertarian theory is that it makes no exceptions in its universal ethic for government.

There are two and only two ways that any economy can be organized. One is by freedom and voluntary choice—the way of the market. The other is by force and dictation—the way of the State.

July 4, the day we celebrate giving our political masters independence from conscience, morality, consequences for evil doing, and basic social and economic reality. The fireworks are the glowing tears of your children's incinerated futures. Cheer happy slaves - your only chains are your deluded joys. Cheer and sing, because for you, songs of death are easier than questions of life.

Experience teaches effectually, but brutally. It makes us acquainted with all the effects of an action, by causing us to feel them; and we cannot fail to finish by knowing that fire burns, if we have burned ourselves. For this rough teacher, I should like, if possible, to substitute a more gentle one. I mean Foresight. For this purpose I shall examine the consequences of certain economical phenomena, by placing in opposition to each other those which are seen, and those which are not seen.

The instant that any government obtains a monetary printing press, it becomes a deeply dishonest government, empowered to rob people by stealth. A government with the power to print money knows no limits.

Copyright: a system of monopoly privilege over the expression of ideas that enables government to stop consumer-friendly economic development and reward uncompetitive and legally privileged elites to fleece the public through surreptitious use of coercion.

Can social progress be made without government? It's like saying 'can happiness be achieved without the initiation of violence? Can romance be achieved without rape? Can profitability be achieved without theft? Can economic growth be achieved without the mass indebted enslavement and counterfeiting of the federal reserve?'.

There are two methods, or means, and only two, whereby man's needs and desires can be satisfied. One is the production and exchange of wealth; this is the economic means. The other is the uncompensated appropriation of wealth produced by others; this is the political means.

It must be remembered that a vast majority of mankind’s history has been spent living under the rule of tyrants and authoritarians. The ideas of Liberty are very new when you consider the big picture. By contrast, various forms of socialism and fascism have been adopted over and over again. Be wary of those who try to present these old and tired ideas as something new and exciting. Liberty and free markets are the way forward if we truly desire peace and prosperity.

The government is a giant logjam in the eternal river of human potential.

Recall that the minimum wage was initially conceived as a method to exclude undesirables from the workforce.

Ultimately, all arguments against markets are arguments against anarchy. Marx understood this much, at least.

In the same way that central banking nearly wrecked the world and created one calamity after another, bitcoin can save the world one transaction at a time. It is time for a new beginning.

The idea that the government has services or goods that they can pass on is a complete farce. Governments have nothing. They can’t create anything, they never have. All they can do is steal from one group and give it to another at the destruction of the principles of freedom, and we ought to challenge that concept.

The phenomenon of economic ignorance is so widespread, and its consequences so frightening, that the objective of reducing that ignorance becomes a goal invested with independent moral worth.

A government is a compulsory territorial monopolist of ultimate decision-making (jurisdiction) and, implied in this, a compulsory territorial monopolist of taxation. That is, a government is the ultimate arbiter, for the inhabitants of a given territory, regarding what is just and what is not, and it can determine unilaterally, i.e., without requiring the consent of those seeking justice or arbitration, the price that justice-seekers must pay to the government for providing this service.

The disdain of profit is due to ignorance, and to an attitude that we may if we wish admire in the ascetic who has chosen to be content with a small share of the riches of this world, but which, when actualised in the form of restrictions on profits of others, is selfish to the extent that it imposes asceticism, and indeed deprivations of all sorts, on others.

The State obtains its revenue by coercion, by threatening dire penalties should the income not be forthcoming. That coercion is known as “taxation,” although in less regularized epochs it was often known as “tribute.” Taxation is theft, purely and simply even though it is theft on a grand and colossal scale which no acknowledged criminals could hope to match. It is a compulsory seizure of the property of the State’s inhabitants, or subjects.

There is only a certain amount of wealth in the world, this thinking goes. Economics is a matter of acquiring and allocating, not creating. This was the view of the world’s smartest people, all top philosophers and not stupid people, for many thousands of years before the age of the enlightenment. It still is.

The very term ‘public utility’ … is an absurd one. Every good is useful ‘to the public,’ and almost every good … may be considered ‘necessary.’ Any designation of a few industries as ‘public utilities’ is completely arbitrary and unjustified.

The desire for an increase of wealth can be satisfied through exchange, which is the only method possible in a capitalist economy, or by violence and petition as in a militarist society, where the strong acquire by force, the weak by petitioning.

Men do not live in perfect harmony with each other. Rather, again and again conflicts arise between them. And the source of these conflicts is always the same: the scarcity of goods. I want to do X with a given good G and you want to do simultaneously Y with the very same good. Because it is impossible for you and me to do simultaneously X and Y with G, you and I must clash. If a superabundance of goods existed, i.e., if, for instance, G were available in unlimited supply, our conflict could be avoided. We could both simultaneously do ‘our thing’ with G. But most goods do not exist in superabundance. Ever since mankind left the Garden of Eden, there has been and always will be scarcity all-around us.

The demoralization that the debase­ment of the currency left in its wake played a major role in bring­ing Adolf Hitler into power in 1933.

To try to cure unemployment by inflation rather than by adjustment of specific wage-rates is like trying to adjust the piano to the stool rather than the stool to the piano.

I don't want the technology of the 1950s, but I want the free market of the 1950s.

Egalitarianism, in every form and shape, is incompatible with the idea of private property.

For anyone who thinks "profit" is evil, I have a challenge for you: try NOT to get any profit in the next week. Profit simply means increasing how much valuable stuff you have, and if you don't profit, you die. Literally. For example, don't buy any food for a week, because when you buy food (or anything), it's because you value the food MORE than you value the money you trade for it. If you didn't, you wouldn't make the trade. So you PROFIT (and so does the seller) every time you buy something. And every time you sell something, or work for money, etc. So before condemning "profit" (or "greed" or "selfishness," for that matter), see if you can survive without it. Then stop repeating vague collectivist BS, and learn to distinguish between "win/win" events (voluntary exchange) where BOTH sides profit, and "win/lose" events, where one side benefits by harming the other side. By the way, "government" is ALWAYS the latter.

Growing economies are built by billions of actors behaving according to their own interests, coordinated through institutions that no one in particular created. Realizing this requires humility, a trait that is in short supply among would-be dictators, politicians, and bureaucrats, which is precisely why these groups are the proven enemies of prosperity in all times and places.

Sadly for Bitcoin, most Austrian economists aren’t fans – even as Bitcoiners remain huge fans of Austrian economics.27 You will find Austrian jargon in common use in the cryptocurrency world. Proponents of Austrian economics include the fringe economics blog Zero Hedge, which has confidently predicted two hundred of the last two recessions. Zero Hedge covers Bitcoin extensively, and Bitcoiners are fans in turn.

Here is a principle to use in all aspects of economics and policy. When you find a good or service that is in huge demand but the supply is so limited to the point that the price goes up and up, look for the regulation that is causing it. This applies regardless of the sector, whether transportation, gas, education, food, beer, or daycare. There is something in the way that is preventing the market from working as it should. If you look carefully enough, you will find the hand of the state making the mess in question.

The essential difference between rich societies and poor societies does not stem from any greater effort the former devote to work, nor even from any greater technological knowledge the former hold. Instead it arises mainly from the fact that rich nations possess a more extensive network of capital goods wisely invested from an entrepreneurial standpoint. These goods consists of machines, tools, computers, buildings, semi-manufactured goods, software, etc., and they exist due to prior savings of the nation's citizens. In other words, comparatively rich societies possess more wealth because they have more time accumulated in the form of capital goods, which places them closer in time to the achievement of much more valuable goals.

The movement that I’m in favor of is a movement of libertarians who do not substitute whim for reason. Now some of them do, obviously, and I’m against that. I’m in favor of reason over whim. As far as I’m concerned, and I think the rest of the movement, too, we are anarcho-capitalists. In other words, we believe that capitalism is the fullest expression of anarchism, and anarchism is the fullest expression of capitalism. Not only are they compatible, but you can’t really have one without the other. True anarchism will be capitalism, and true capitalism will be anarchism.

Ultimately, we need to take control over the money supply out of the hands of our governments and make the production of money again subject to the principle of free association. The first step to endorsing and promoting this strategy is to realize that governments do not—indeed cannot—fulfill any positive role whatever through the control of our money.

The overwhelming tendency of markets is to bring people together, break down prejudices, persuade people of the need to cooperate regardless of class, race, religion, sex/gender, and physical ability. The same is obviously and especially true of sexual orientation. It is the market that rewards people who put aside their biases and seek gains through trade. This is why states devoted to racialist and hateful policies always resort to violence in control of the marketplace.

Commerce tends toward rewarding inclusion, broadness, and liberality. Tribal loyalties, ethnic and religious bigotries, and irrational prejudices are bad for business. The merchant class has been conventionally distrusted by tribalist leaders -- from the ancient to the modern world -- precisely because merchantcraft tends to break down barriers between groups.

Here's something I still can't get over. Amazes and thrills me every time. I'm sitting here and want a certain book. So I search, click, and then I have the book. Every time, my heart does a little leap of joy. What a beautiful world the market is making.

The valuations which result in determination of definite prices are different. Each party attaches a higher value to the good he receives than to that he gives away. The exchange ratio, the price, is not the product of equality of valuation, but on the contrary, the product of a discrepancy in valuation.

Government as we now know it in the USA and other economically advanced countries is so manifestly horrifying, so corrupt, counterproductive, and outright vicious, that one might well wonder how it continues to enjoy so much popular legitimacy and to be perceived so widely as not only tolerable but indispensable. The answer, in overwhelming part, may be reduced to a two-part formula: bribes and bamboozlement (classically "bread and circuses"). Under the former rubric falls the vast array of government "benefits" and goodies of all sorts, from corporate subsidies and privileges to professional grants and contracts to welfare payments and health care for low-income people and other members of the lumpenproletariat. Under the latter rubric fall such measures as the government schools, the government's lapdog news media, and the government's collaboration with the producers of professional sporting events and Hollywood films. Seen as a semi-integrated whole, these measures give current governments a strong hold on the public's allegiance and instill in the masses and the elites alike a deep fear of anything that seriously threatens the status quo.

No people and no part of a people shall be held against its will in a political association that it does not want.

Trade and money, which go together in a stream of energy, inevitably wash away the enclosing walls of a society of status.

The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually slaves of some defunct economist. (The General Theory of Employment, Interest, and Money)

Yet, perhaps unexpectedly, investment appraisal can teach valuable lessons about the damage caused by government intervention, lessons that would otherwise fall outside the scope of a course on investments or corporate finance.

Monopoly is a market, or part of a market, reserved to the exclusive possession of one or more sellers by means of the initiation of physical force by the government, or with the sanction of the government. Monopoly exists insofar as the freedom of competition is violated, with the freedom of competition being understood as the absence of the initiation of physical force as the preventive of competition. Where there is no initiation of physical force to violate the freedom of competition, there is no monopoly. The freedom of competition is violated only insofar as individuals are excluded from markets or parts of markets by means of the initiation of physical force. Monopoly is thus a market or part of a market reserved to the exclusive possession of one or more sellers by means of the initiation of physical force. It is thus something imposed upon the market from without—by the government. (Private individuals—gangsters—can initiate force to reserve markets only if the government allows it and thereby sanctions it.) Thus, monopoly is not something which emerges from the normal operation of the economic system, and which the government must control.

By contrast, human action, to use the “Austrian” economic term, is not merely reactive to constraints and utility functions but active and creative, the exercise of the free and creative and (some of us think) God-given will that can say yes, or no.

It’s one thing to be shown a supply and demand graph and told that minimum wage increases can destroy the viability of a business: it’s quite another to see the NPV of a business disappear at the press of a button, simply by increasing the minimum wage by a dollar or two.

The first people to get the new money are the counterfeiters, which they use to buy various goods and services. The second receivers of the new money are the retailers who sell those goods to the counterfeiters. And on and on the new money ripples out through the system, going from one pocket or till to another. As it does so, there is an immediate redistribution effect. For first the counterfeiters, then the retailers, etc. have new money and monetary income they use to bid up goods and services, increasing their demand and raising the prices of the goods that they purchase. But as prices of goods begin to rise in response to the higher quantity of money, those who haven't yet received the new money find the prices of the goods they buy have gone up, while their own selling prices or incomes have not risen. In short, the early receivers of the new money in this market chain of events gain at the expense of those who receive the money toward the end of the chain, and still worse losers are the people (e.g., those on fixed incomes such as annuities, interest, or pensions) who never receive the new money at all.

The nation as such is not a large subject that has needs, that works, practices economy, and consumes. . . . Thus the phenomena of “national economy” . . . are, rather, the results of all the innumerable individual economic efforts in the nation and . . . must also be theoretically interpreted in this light. . . .Whoever wants to understand theoretically the phenomena of “national economy” . . . must for this reason attempt to go back to their true elements, to the singular economies in the nation, and to investigate the laws by which the former are built up from the latter.

What is a price? It is a proposed point of agreement between a buyer and seller. The proposal is the key. It is not a marching order. Past prices represent deals done in history. Current prices represent possible deals in the future. Prices embed vast information about perceived realities: resource availability, consumer demand, cultural biases and habits, speculations about the future. The price is also an amazing tool. It provides an objective basis for accounting and the assessment of profit and loss. Without prices, real prices rooted in real market experience, we’d been lost.

The boom brought about by the banks’ policy of extending credit must necessarily end sooner or later. Unless they are willing to let their policy completely destroy the monetary and credit system, the banks themselves must cut it short before the catastrophe occurs. The longer the period of credit expansion and the longer the banks delay in changing their policy, the worse will be the consequences of the malinvestments and of the inordinate speculation characterizing the boom; and as a result the longer will be the period of depression and the more uncertain the date of recovery and return to normal economic activity

One cannot help wondering if the day will ever arrive when tailoring clothes for people in accordance with their height and girth will ever be considered discriminatory and therefore prohibited; such a practice must of necessity make (invidious) distinctions between individuals, and this is what the equalitarian philosophy would appear to deem improper.

L'endoctrinement de la jeunesse dans les écoles était l'un des principaux piliers de ces États esclavagistes. En vérité, la principale différence entre les horreurs du XXème siècle et les despotismes plus anciens est que ces tyrannies modernes ont dû reposer sur un soutien des masses plus direct, et que par conséquent l'alphabétisation obligatoire et l'endoctrinement ont joué un rôle crucial.

According to this view, free-market capitalism and state-controlled communism aren’t competing ideologies, ethical creeds or political institutions. At bottom, they are competing data-processing systems. Capitalism uses distributed processing, whereas communism relies on centralised processing. Capitalism processes data by directly connecting all producers and consumers to one another, and allowing them to exchange information freely and make decisions independently. For example, how do you determine the price of bread in a free market? Well, every bakery may produce as much bread as it likes, and charge for it as much as it wants. The customers are equally free to buy as much bread as they can afford, or take their business to the competitor. It isn’t illegal to charge $1,000 for a baguette, but nobody is likely to buy it. On a much grander scale, if investors predict increased demand for bread, they will buy shares of biotech firms that genetically engineer more prolific wheat strains. The inflow of capital will enable the firms to speed up their research, thereby providing more wheat faster, and averting bread shortages. Even if one biotech giant adopts a flawed theory and reaches an impasse, its more successful competitors will achieve the hoped-for breakthrough. Free-market capitalism thus distributes the work of analysing data and making decisions between many independent but interconnected processors. As the Austrian economics guru Friedrich Hayek explained, ‘In a system in which the knowledge of the relevant facts is dispersed among many people, prices can act to coordinate the separate actions of different people.

The entrepreneur who is reckoning in terms of a currency with a stable value is unable to compete with the entrepreneur who is prepared to make a quasi-gift of part of his capital to his customers. In 1920 and 1921, Dutch traders who had sold commodities to Austria could buy them back again after a while much cheaper than they had originally sold them, because the Austrian traders completely failed to see that they were selling them for less than they had cost.

The contemporary progressive mantra considers it laudable to argue that different races, cultures, or religions possess distinct ways of knowing. However, not too long ago, the idea that people of different races or classes possessed distinct ways of thinking and reasoning, was reserved for racists and other miscreants. Ludwig von Mises, a leading figure of the Austrian School of Economics and a staunch defender of classical liberalism, coined the term polylogism to capture this exact folly. Mises differentiated between Marxian polylogism and racial polylogism. In the former case, an individual’s method of thinking was determined by his social class while in the latter case, race was the guiding factor. Mises was well aware of the illogical nature of this premise when he remarked: “A consistent supporter of polylogism would have to maintain that ideas are correct because their author is a member of the right class, nation, or race. But consistency is not one of their virtues. Thus the Marxians are prepared to assign the epithet ‘proletarian thinker’ to everybody whose doctrines they approve.

it was Böhm-Bawerk who defeated them so effectively with economic theories and critiques such that Marxism did not take root in economics to the degree that it has in other professions, such as sociology and history.10 Using impeccable logic, Böhm-Bawerk showed that the workers who are employed by the entrepreneur are paid immediately for the “full value” of their labor, so long as that value is correctly calculated by including the time element. After all, in most production processes the input of labor hours doesn’t immediately yield a finished good.

The Austrian born Von Hayek has long been under the control of David Rockefeller, and Von Hayek theories have been fairly widely accepted in the United States for some time, especially in “conservative” circles. According to Von Hayek, a future United States economic platform must be based on (a) urban black markets, (b) small Hong Kong type industries utilizing sweatshop labor, (c) the tourist trade, (d) free enterprise zones where speculators can operate unhindered and where the drug trade can flourish, (e) the end of all industrial activity and (f) closing down of all nuclear energy plants.

The error in this conclusion may be most simply demonstrated by means of an actual example. Let us select for this purpose the monetary history of Austria, which Laughlin also uses as an illustration. From 1859 onwards the Austrian National Bank was released from the obligation to convert its notes on demand into silver, and nobody could tell when the State paper-money issued in 1866 would be redeemed, or even if it would be redeemed at all. It was not until the later 'nineties that the transition to metallic money was completed by the actual resumption of cash payments on the part of the Austro-Hungarian Bank.

But even though questions of currency policy are never more than questions of the value of money, they are sometimes disguised so that their true nature is hidden from the uninitiated. Public opinion is dominated by erroneous views on the nature of money and its value, and misunderstood slogans have to take the place of clear and precise ideas. The fine and complicated mechanism of the money and credit system is wrapped in obscurity, the proceedings on the Stock Exchange are a mystery, the function and significance of the banks elude interpretation. So it is not surprising that the arguments brought forward in the conflict of the different interests often missed the point altogether. Counsel was darkened with cryptic phrases whose meaning was probably hidden even from those who uttered them. Americans spoke of 'the dollar of our fathers' and Austrians of 'our dear old gulden note'; silver, the money of the common man, was set up against gold, the money of the aristocracy. Many a tribune of the people, in many a passionate discourse, sounded the loud praises of silver, which, hidden in deep mines, lay awaiting the time when it should come forth into the light of day to ransom miserable humanity, languishing in its wretchedness.

While the Austrian crown was dissolving like jelly in your fingers, everyone wanted Swiss francs and American dollars, and large numbers of foreigners exploited the economic situation to feed on the twitching corpse of the old Austrian currency. Austria was ‘discovered’, and became disastrously popular with foreign visitors in a parody of the society season. All the hotels in Vienna were crammed full with these vultures; they would buy anything, from toothbrushes to country estates; they cleared out private collections of antiquities and the antique dealers’ shops before the owners realised how badly they had been robbed and cheated in their time of need. Hotel receptionists from Switzerland and Dutch shorthand typists stayed in the princely apartments of the Ringstrasse hotels. Incredible as it may seem, I can vouch for it that for a long time the famous, de luxe Hotel de l’Europe in Salzburg was entirely booked by unemployed members of the English proletariat, who could live here more cheaply than in their slums at home, thanks to the generous unemployment benefit they received. Anything that was not nailed down disappeared. Word gradually spread of the cheap living and low prices in Austria. Greedy visitors came from further and further afield, from Sweden, from France, and you heard more Italian, French, Turkish and Romanian than German spoken in the streets of the city centre of Vienna.

One variety of the balance-of-payments theory attempts to distinguish between the importation of necessaries and the importation of articles that can be dispensed with. Necessaries, it is said, have to be bought whatever their price is, simply because they cannot be done without. Consequently there must be a continual depreciation in the currency of a country that is obliged to import necessaries from abroad and itself is able to export only relatively dispensable articles. To argue thus is to forget that the greater or less necessity or dispensability of individual goods is fully expressed in the intensity and extent of the demand for them in themarket,and thus in the amount of money which is paid for them. However strong the desire of the Austrians for foreign bread, meat, coal, or sugar, may be, they can only get these things if they are able to pay for them.

centuries-long debate over the nature of money can be reduced to two sides. One school sees money as merely a commodity, a preexisting thing, with its own inherent value. This group believes that societies chose certain commodities to become mutually recognized units of exchange in order to overcome the cumbersome business of barter. Exchanging sheep for bread was imprecise, so in our agrarian past traders agreed that a certain commodity, be it shells or rocks or gold, could be a stand-in for everything else. This “metallism” viewpoint, as it is known, encourages the notion that a currency should itself be, or at least be backed by, some tangible material. This orthodox view of currency is embraced by many gold bugs and hard-money advocates from the so-called Austrian school of economics, a group that has enjoyed a renaissance in the wake of the financial crisis with its critiques of expansionist central-bank policies and inflationary fiat currencies. They blame the asset bubble that led to the crisis on reckless monetary expansion by unfettered central banks. The other side of the argument belongs to the “chartalist” school, a group that looks past the thing of currency and focuses instead on the credit and trust relationships between the individual and society at large that currency embodies. This view, the one we subscribe to and which informs

...Alas, this is simply an illusion. For how can it be possible to relate two or more observational experiences, even if they concern the relations between things that are perceived to be the same or similar, as falsifying (or confirming) each other, rather than merely neutrally record them as one experience here and one experience here, one repetitive of another or not, and leaving it at that (i.e., regarding them as logically incommensurable) unless one presupposed the existence of time-invariantly operating causes? Only if the existence of such time-invariantly operating causes could be assumed would there by any logically compelling reason to regard them as commensurable and as falsifying or confirming each other. However, Popper, like all empiricists, denies that any such assumption can be given an a priori defense (there are for him no such things as a priori true propositions about reality such as the causality principle would have to be) and is itself merely hypothetical. Yet clearly, if the possibility of constantly operating causes as such is only a hypothetical one, then it can hardly be claimed, as Popper does, that any particular predictive hypothesis could ever be falsified or confirmed. For then the falsification (or confirmation) would have to be considered a hypothetical one: any predictive hypothesis would only under go tests whose status as tests were themselves hypothetical. And hence one would be right back in the muddy midst of skepticism. Only if the causality principle as such could be unconditionally established as true, could any particular causal hypothesis ever be testable, and the outcome of a test provide rational grounds for deciding whether or not to uphold a given hypothesis.

To this point, Sen. Rand Paul of Kentucky has been the Republican flavor of the year. Events from the IRS scandal to NSA revelations to the Obamacare train wreck have corroborated libertarian suspicions of federal power. And Paul has shown serious populist skills in cultivating those fears for his political benefit. For a while, he succeeded in a difficult maneuver: Accepting the inheritance of his father's movement while distancing himself from the loonier aspects of his father's ideology. But now Rand Paul has fallen spectacularly off the tightrope. It turns out that a senior member of his Senate staff, Jack Hunter, has a history of neo-Confederate radio rants. And Paul has come to the defense of his aide. . . . This would not be the first time that Paul has heard secessionist talk in his circle of confederates--I mean, associates. His father has attacked Lincoln for causing a "senseless" war and ruling with an "iron fist." Others allied with Paulism in various think tanks and websites have accused Lincoln of mass murder and treason. For Rand Paul to categorically repudiate such views and all who hold them would be to excommunicate a good portion of his father's movement. This disdain for Lincoln is not a quirk or a coincidence. Paulism involves more than the repeal of Obamacare. It is a form of libertarianism that categorically objects to 150 years of expanding federal power. . . . Not all libertarians, of course, view Appomattox as a temporary setback. A libertarian debate on the topic: "Lincoln: Hero or Despot?" would be two-sided, lively and well attended. But Paulism is more than the political expression of the Austrian school of economics. It is a wildly ambitious ideology in which Hunter's neo-Confederate views are not uncommon. What does this mean for the GOP? It is a reminder that, however reassuring his manner, it is impossible for Rand Paul to join the Republican mainstream. The triumph of his ideas and movement would fundamentally shift the mainstream and demolish a century and a half of Republican political history. The GOP could no longer be the party of Reagan's internationalism or of Lincoln's belief in a strong union dedicated to civil rights.

The form of argument used by Farjoun and Machover is rather alien to the tradition of political economy. The later has tended, from its inception, to look for explanations in terms of the actions of rational profit maximising individuals directing the economy towards some sort of equilibrium. Instead Farjoun and Machover, who were mathematicians not economists, imported the form of reasoning that had been used in thermodynamics or statistical mechanics. This branch of physics deals with the behaviour of large complex systems with huge numbers of degrees of freedom. The classical example of this type of system is gas composed of huge numbers of randomly moving molecules. In such a system it is fruitless to try and form a deterministic and microscopic picture of the interaction of individual molecules. But you can make a number of useful deductions about the statistical properties of the whole collection of molecules. It was from the statistical properties of such collections that Boltzmann was able to derive the laws of thermodynamics[Bol95]. What Farjoun and Machover did was apply this form of reasoning to another chaotic system with a large number of degrees of freedom : the market economy. In doing this they initiated a new discipline of study : econophysics. This, in a very radical way, views the economy as a process without a subject. It assumes nothing about knowing subjects, instead it attempts to apply the principle of parsimony. It assumes nothing about the individual economic actors. Instead it theorises the aggregate constraints and and statistical distributions of the system that arise from the assumption of maximal disorder. A such this approach is anathema to the subjectivist Austrian school9.

Bitcoin is based on ideas from a particular subculture of cryptographers, the “cypherpunks” of the 1990s, who were into the “anarcho-capitalism” of heterodox American economist Murray Rothbard and the Austrian School of economics.46 The key concept is extremist libertarianism. Not just less regulation, and more freedoms for business — but no regulations, and total freedom for business. Somehow, complicated social property rights would still exist without any government

History, it is said, is written by the victors. In the late 1920s, Hayek claimed that monetary policy had taken the wrong course and predicted a deflationary bust. Irving Fisher, on the other hand, saw nothing wrong at the time with either America’s economy or its monetary policy, famously opining in the summer of 1929 that US stocks had reached a ‘permanently high plateau’. If accuracy of prediction is what matters for economic theory, as Milton Friedman later claimed, then Hayek’s interpretation should have become the received wisdom of his profession. Yet the Austrian’s interpretation of the 1920s and its aftermath has been more or less air-brushed from the history books, while Fisher’s monetarist view has become received wisdom.

If every person has the right to defend―even by force― his person, his liberty, and his property, then it follows that a group of men have the right to organize and support a common force to protect these rights constantly.” ~ Frederic Bastiat (1801-1850) French Politician & Economist Forefather of Libertarian Ideals & Austrian Economics Theory of Thought

the first is the Austrian historian Rolf Bauer, whose book The Peasant Production of Opium in Nineteenth-Century India was published in 2019. The second is Matthew Wormer, an American, whose dissertation, titled ‘Opium, Economic Thought, and the Making of Britain’s Free Trade Empire, 1773–1839’, earned him a PhD in history from Stanford in 2022.

It is not from their intrinsic nature that goods gain the character of economic goods, but through their relation to men and through their ability to lead, directly or indirectly, to the satisfaction of human needs.

Some economists became obsessed with market efficiency and others with market failure. Generally held to be members of opposite schools-"freshwater" and "saltwater," Chicago and Cambridge, liberal and conservative, Austrian and Keynesian-both sides share an essential economic vision. They see their discipline as successful insofar as it eliminates surprise-insofar, that is, as the inexorable workings of the machine override the initiatives of the human actors.

On December 18, he asked each side to set forth its terms for ending the war. The Allies demanded conditions certain to be unacceptable: withdrawal from all occupied territory and virtual dismemberment of the German and Austrian empires. The Germans wanted the iron ore fields in Lorraine, economic control over Belgium, and the Belgian Congo and Poland as German protectorates. Both sides told Wilson, in effect, no thank you, since each expected to win the war.

While Krugman thus ignored the role of the Fed’s inflationary monetary policy, Ron Paul had explained that when interest rates are high, it encourages savings, but when the Fed artificially lowers interest rates, the incentive is to borrow and to spend, rather than to save dollars that would have less purchasing power tomorrow than today.

To be clear, my contention is not merely that the alt-right is stupid, nor even that its individual adherents are. It is and they are, but the problem is more fundamental: the alt-right is stupidity. It’s the elemental particle of which every part is comprised. To engage in alt-right thinking is to turn one’s self into a vacuous skinsuit animated by raw stupidity. There is literally not a single shred of non-stupidity in the entire thing. Mencius Moldbug? Stupid. Milo Yiannopoulos? Stupid. Donald Trump? Peter Thiel? Vox Day? Stupid. Stupid. Stupid. Neoreaction is stupid. Race realism is stupid. Austrian economics is stupid. #MAGA and Pepe and the Daily Stormer are stupid. Even Nick Land is only not stupid to the precise extent to which there is a possibility that what he’s doing is some elaborate game, and frankly, even that sounds pretty stupid once you say it out loud. Every single detail of every single aspect of this entire cratering shitstorm in which the human race seems hell-bent on going extinct is absolutely fucking stupid.

These events have not been the first to change my views on economics since I started studying the subject at Oxford University in 1967.9 Over the subsequent forty-five years I have learned a great deal and, unsurprisingly, changed my mind from time to time. In the late 1960s and early 1970s, for example, I came to the view that a bigger role for markets and a macroeconomic policy dedicated to monetary stability were essential, in both high-income and developing countries. I participated, therefore, in the move towards more market-oriented economic perspectives that took place at that time. I was particularly impressed with the Austrian view of the market economy as a system for encouraging the search for profitable opportunities, in contrast to the neoclassical fixation with equilibrium: the writings of Joseph Schumpeter and Hayek were (and remain) powerful influences. The present crisis has underlined my scepticism about equilibrium,

The Austrian theory rests fundamentally upon the non-reversibility of the investment operation. Once "free capital" has been converted into buildings and machinery, any failure of events to conform to expectations will upset everything.

Thomas Piketty, the economist of the moment, writes that after he obtained an economics doctorate, and spent several years teaching at M.I.T., “I was only too aware of the fact that I knew nothing about the world’s economic problems.” Piketty goes on, “To put it bluntly, the discipline of economics has to get over its childish passion for mathematics and for purely theoretical and often highly ideological speculation, at the expense of historical research and collaboration with the other social sciences.” The student group agrees with Piketty. In the open letter, the students argue that an economics degree “should include interdisciplinary approaches and allow students to engage with other social sciences and the humanities.” But the students’ main beef is that, even within the subject of economics, the standard curriculum is overly restrictive, and excludes much that is valuable. The letter calls for students to be exposed to “a variety of theoretical perspectives, from the commonly taught neoclassically-based approaches to the largely excluded classical, post-Keynesian, institutional, ecological, feminist, Marxist and Austrian traditions—among others. Most economics students graduate without ever encountering

John Allison is the former CEO of a North Carolina bank, BB&T, which profitably surmounted the crisis after growing from $4.5 billion in assets when he took over in 1989 to $152 billion in 2008. Allison ascribed his success to decentralization of power in the branches of his bank. But decentralized power, he warned, has to be guarded from the well-meaning elites “who like to run their system and hate deviations.” So as CEO, Allison had to insist to his managers that with localized decision-making, “We get better information, we get faster decisions, we understand the market better.”3 Allison was espousing a central insight of the new economics of information. At the heart of capitalism is the unification of knowledge and power. As Friedrich Hayek, the leader of the Austrian school of economics, put it, “To assume all the knowledge to be given to a single mind … is to disregard everything that is important and significant in the real world.”4 Because knowledge is dispersed, power must be as well.

While Einstein was still a patent clerk he had studied the work of the Austrian physicist Ernst Mach, for whom the goal of science was not to discern the nature of reality, but to describe experimental data, the 'facts', as economically as possible.

To the Austrian economics of subjectivity, time provides an objective foundation.

Unfortunately, politicians hold the conviction that money growth gives us economic growth. They are blind to the fact that government cannot create anything. Government cannot make man richer, but it can make him poorer.

The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy.”33

Mises and Hayek Beginning with Ludwig von Mises and F.A. Hayek, the links between liberalism and the Austrian School become intense and pervasive, since these two scholars were themselves at once the outstanding Austrian economists and the most distinguished liberal thinkers of the twentieth century. The American academic world, however, deemed none of this sufficient for them to be accorded the kind of positions to which they were clearly entitled.50 They, and in particular Mises, were also responsible to a greater degree than is generally appreciated for the upsurge of the free-market philosophy in the second half of the century.51 But since the views of the two great men are so often amalgamated, it should be emphasized that not only did they differ to an extent on economic theory (Salerno 1993; see also Kirzner 1992c: 119–36), but, more pertinently to the theme of this essay, they exhibited a sharp distinction in the degree of their liberalism. What follows refers to Hayek’s political attitudes, not to his contributions to economic science. These were highly significant and valuable in the earlier part of his career, as he together with Mises built the theoretical foundations of the modern Austrian school.52 While Mises was a staunch advocate of the laissez-faire market economy (Mises 1978a; Rothbard 1988: 40; Hoppe 1993; Klein 1999), Hayek was always more open to what he saw as the useful possibilities of state action. He had been a student of Wieser’s, and, as he conceded, he was “attracted to him . . . because unlike most of the other members of the Austrian School [Wieser] had a good deal of sympathy with [the] mild Fabian Socialism to which I was inclined as a young man. He in fact prided himself that his theory of marginal utility had provided the basis of progressive taxation . . .” (Hayek 1983: 17). Early in his career, Hayek stated that the lessons of economics will create a presumption against state interference, adding: However, this by no means does away with the positive part of the economist’s task, the delimitation of the field within which collective action is not only unobjectionable but actually a useful means of obtaining the desired ends. . .the classical writers very much neglected the positive part of the task and thereby allowed the impression to gain ground that laissez-faire was their ultimate and only conclusion . . . (1933: 133–34) This remained Hayek’s standpoint throughout his long and richly productive scholarly life. It is regrettable, but typical, that a great many confused commentators continue to characterize him as a advocate of laissez-faire.53 In fact, he

To understand what’s going on in the world, people must pursue economic literacy. I am not talking about the bastardized economics disseminated by ivory tower pseudo-intellectuals. I am talking about Austrian praxeology; I am talking about human action. It’s through this conduit of knowledge that people internalize the vile and evil nature of governments.

Blaming wild market volatility on the “animal spirits” of the herd mentality takes the focus off where it belongs: on the actions of the government. Instead of functioning as instruments of information, signaling to entrepreneurs how and when best to serve consumers, interest rates are perpetually manipulated by central bank actions to the point of meaninglessness. Artificial changes in interest rates become a deceptive feint by which entrepreneurs succumb to malinvestment, because they believe there are more resources (i.e., savings) in the system than there really are. Monetary policy insidiously plays with our time preferences and our very ability to engage in economic calculation. The greater the distortion, the greater destruction needed to correct it.

Years later, Mises would take on the historicists in his book, Theory and History, countering their view that economic theorems are void because they rely on a priori reasoning and that only historical experience is valid. As he wrote: “Such historical experience does not give the observer facts in the sense in which the natural sciences apply this term to the results obtained in laboratory experiments.” He further criticized those “who call their offices, studies, and libraries ‘laboratories’ for research in economics, statistics, or the social sciences” as being “hopelessly muddleheaded.” Mises stated, “Historical facts need to be interpreted on the ground of previously available theorems.

Of all the tragedies wrought by this collective amnesia in economics, the greatest loss to the world is the eclipse of the “Austrian School.” Founded in the 1870s and 1880s, and still barely alive, the Austrian School has had to suffer far more neglect than the other schools of economics for a variety of powerful reasons. First, of course, it was founded a century ago, which, in the current scientific age, is in itself suspicious. Second, the Austrian School has from the beginning been self-consciously philosophic rather than “scientistic”; far more concerned with methodology and epistemology than other modern economists, the Austrians arrived early at a principled opposition to the use of mathematics or of statistical “testing” in economic theory. By doing so, they set themselves in opposition to all the positivistic, natural-science-imitating trends of this century. It meant, furthermore, that Austrians continued to write fundamental treatises while other economists were setting their sights on narrow, mathematically oriented articles. And third, by stressing the individual and his choices, both methodologically and politically, Austrians were setting themselves against the holism and statism of this century as well.

Don Lavoie’s Rivalry and Central Planning: The Socialist Debate Reconsidered, originally published by Cambridge University Press in 1985, was a vital contribution to the scholarly literature in comparative economic systems and the Austrian school

When the central bank lowers interest rates below what they would have reached on the market, it sets in motion a series of responses by investors and consumers that will prove to be incompatible. The result is the recession, which is the economy’s return to health: the economy’s unsustainable configuration is unwound, and resources (including labor) are reallocated to lines of production that make sense in terms of resource availability and consumer preferences.

When the central bank lowers interest rates below what they would have reached on the market, it sets in motion a series of responses by investors and consumers that will prove to be incompatible.

The Austrian School of economics is an alternative to the mainstream approach. It places economics on a sound, human basis. It avoids the traps that plague most of modern economics: the assumption of selfishness as the basic human motivation, a narrow definition of rational behavior, and the overuse of unrealistic models.

When it becomes dominated by a collectivist creed, democracy will inevitably destroy itself.

Anytime we step outside of the realm of the market economy and monetary calculation, the social system must attempt to provide a substitute for property, prices, and profit-and-loss to align incentives, guide decisions, lure entrants and innovation, and discipline and select superior methods of production to reveal opportunities for mutually beneficial cooperation. Whether or not these substitutes can effectively serve the function that the price system does is the crux of the debate in comparative institutional analysis.

Bitcoin represents the most authentic implementation of Austrian monetary principles in human history. It achieves what gold aspired to but couldn't fully deliver due to physical limitations

Samuel Gregg: Smith’s experiments have also provided considerable evidence that, as he wrote in a 1994 paper, “economic agents can achieve efficient outcomes which are not part of their intention.” Many will recognize this as one of the central claims of The Wealth of Nations, the book written by Smith’s famous namesake two and a half centuries ago. Interestingly, Adam Smith’s argument was not one that Vernon Smith had been inclined to accept before beginning his experimental research. As the latter went on to say in his 1994 paper, fey outside of the Austrian and Chicago traditions believed it, circa 1956. Certainly, I was not primed to believe it, having been raised by a socialist mother, and further handicapped (in this regard) by a Harvard education.” Given, however, what his experiments revealed about what he called “the error in my thinking,” Smith changed his mind. Truth was what mattered—not ego or preexisting ideological commitments.

Inflation is caused by money printing. Period.

Long after Rockefeller had exited the industrial scene, various economists, while espousing the general superiority of competition, conceded the economic wisdom of trusts under certain conditions. The conservative, Austrian-born economist Joseph A. Schumpeter, for example, contended that monopolies might prove beneficial during depressions or in new, rapidly shifting industries. By replacing turmoil with stability, a monopoly “may make fortresses out of what otherwise might be centers of devastation” and “in the end produce not only steadier but also greater expansion of total output than could be secured by an entirely uncontrolled onward rush that cannot fail to be studded with catastrophes.” Schumpeter imagined that entrepreneurs wouldn’t commit large sums to risky ventures if the future seemed cloudy and new competitors could easily spoil their plans. “On the one hand, largest-scale plans could in many cases not materialize at all if it were not known from the outset that competition will be discouraged by heavy capital requirements or lack of experience, or that means are available to discourage or checkmate it so as to gain the time and space for further developments.

When human beings act, they inevitably synthesise memories of the past into new expectations and mental images for the future, regarding the different stages in the action process they will follow. The future is never predetermined, but instead the actor imagines, creates and builds it step by step. Therefore, the future is always uncertain, since it has yet to be done or built, and the only part of it the actor possesses consists of specific ideas, mental images or expectations he hopes to realise through the completion of stages he imagines.

The direct cause of massive unemployment is labour market inflexibility. In fact, state intervention in the labour market and union coercion, made possible by the privileges the legal system confers on unions, results in a series of regulations which make the labour market one of the most rigid. Furthermore, due to the artificial costs labour legislation generates, the discounted value of a worker's real marginal productivity tends to fall short of the total labour cost the entrepreneur incurs in hiring the worker. This leads to markedly high unemployment, which will affect all workers whose expected marginal productivity yields a discounted value lower than the cost involved in employing them. Therefore they will be dismissed or not hired at all.

We can see matters particularly clearly if we rely on M-A (for Austrian), rather than on the various Ms issued by the Fed which are statistical artifacts devoid of real meaning. After increasing rapidly for several years, the money supply remained flat from April to August 1987, long enough to help precipitate the great stock market crash of October. Then, M-A rose by about 2.5% per year, increasing from $1,905 billion in August 1987 to $1,948 billion in July 1988. Since July, however, this modest increase has been reversed, and the money supply remained level until the end of the year, then fell sharply to $1,897 billion by the end of January 1989. From the middle of 1988, then, until the end of January 1989, the total money supply, M-A, fell in absolute terms by no less than an annual rate of 5.2%. The last time M-A fell that sharply was in 1979–80, precipitating the last great recession. This is not an argument for the Fed to expand money again in panic. Quite the contrary. Once an inflationary boom is launched, a recession is not only inevitable but is also the only way of correcting the distortions of the boom and returning the economy to health. The quicker a recession comes the better, and the more it is allowed to perform its corrective work, the sooner full recovery will arrive.

an economist's political views are largely a consequence of how important a factor s/he believes market failure to be in real economic affairs

democracy <...> requires individuals to make political decisions as if they possessed more knowledge than it would ever be worth their while to possess.

greatest in 1937. It expanded geographically to Holland, Belgium, and England and the colonies and, with the partitions of Poland to the Austrian interior, Hungary and Russia’s southern provinces. With “geographical expansion” came an “intensification of Jewish economic life.”28 He asserted that it was imperative to consider the “totality of forces” to understand “the halting historic progression toward Jewish equality of rights.”29 He attributed significance to capitalism, the Enlightenment, and the Haskalah (beginning in Italy and Holland, not Germany).30 One of his more memorable lines is “To find the beginnings of Jewish enlightenment in Mendelssohn, is a curious misjudgment, due mainly to the provincialism of German Jewish historiography.”31