Birth of a Movement
The war years had brought economic hardship to Mises, and if he ever had any illusions about the state of the American mind before he came to the United States in 1940, he had certainly lost them by the end of the war.
American public opinion was already entirely under the sway of statism. And as a consequence the old American liberties were at an all-time low. As Mises wrote to a German correspondent: "Unfortunately one can become acquainted with the fruits of the planned economy here in the U.S.A. too."
Similarly, to a promising young economist in Austria he wrote that the American literature on economics was, if anything, worse than the European literature. FULL ARTICLE
Comments (5)
"...Third, again echoing other neo-liberals, Hayek defended what seemed to be a pragmatic middle-of-the-road solution that appealed to the American mind. He emphasized that he did not advocate laissez-faire but a new brand of liberalism...."
This part got me rather perplexed. In 1945 Hayek followed the book with his paper--The Use of Information in Society--whereby he reasons that government planning cannot outplan market mechanism.
The divergence in views on the role of government between Mises and Hayek seems most apparent here.
On the other hand, in an interview in 2003, Shenoi pointed out Hayek's ideas that seemed to promote anarchy.
As my reading has led me this far, Rothbard's critiques on Hayek are mostly on the latter's low trust in man's capacity to reason.
I wonder what Mises had to say about Hayek's seeming inconsistency.
Furthermore, having read My Years with Mises, I find it rather hard to swallow Hullsman's account that the honeymoon (for 9 years) had been a factor preventing Mises to defend his laissez fair position.
I would also appreciate enlightenment here. Thanks
Published: October 31, 2007 4:24 AM
Hayek, for all his brilliance, is one of the more enigmatic figures of the Austrian School.
As an unrelated question, is anyone aware if Schumpeter is considered an Austrian? Wiki says he was affiliated with the school, most references here seem to suggest a degree of affiliation but not membership, and Skousen mentions him as an Austrian in Vienna & Chicago. So where does he fit in?
Published: October 31, 2007 12:35 PM
Anthony: "...is anyone aware if Schumpeter is considered an Austrian?"
I just listened to a fascinating pod cast about Schumpeter at
http://www.econtalk.org/archives/2007/10/mccraw_on_schum.html
The answer to your question: could be.
I read parts of his history of econ thought and really liked it, except near the end where he waxes prophetic about econometric modeling. I wish he could have lived to see what a mess it is today. He makes the statement in it that he believed econometrics gave economists the tools to make planned economies work! And he was a big proponent of econometrics.
I think if Austrians are going to change the econ paradigm, they'll have to learn to speak the language of math that drives modern academic econ. Otherwise, no one will listen. But the Austrian skepticism about math is good.
Published: October 31, 2007 4:25 PM
Fundamentalist, I agree. There already seems to be a drift to using mathematics in praxeology. Mises warned against it, but I do not see it as fundamentally incompatible, so long as one remembers how praxeological theorems are formed and what the proper methodology for doing so is. As for empirical evidence, Austrians seem far more adept than mainstream economists when they engage in statistical studies, so I think it might in fact be a profitable venture in using the mainstream's own tools to bring it down. I doubt they would make the stupid mistake of conflating economic history with actual economics. Thanks for the podcast.
Published: October 31, 2007 8:10 PM
I finally found this paper on Hayek's Road To Serfdom. It's very lucid and useful; my thanks go to the writer.
(Link: http://mises.org/journals/jls/12_2/12_2_6.pdf)
Published: November 7, 2007 2:50 AM