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Economic Teaching at the Universities

Mises Daily: Friday, January 30, 2009 by

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[From Planning for Freedom. Originally published in The Freeman, April 7, 1952.]

A few years ago, a House of Representatives Subcommittee on Publicity and Propaganda in the Executive Departments, under the chairmanship of Representative Forest A. Harness, investigated federal propaganda operations. On one occasion the committee had as a witness a government-employed doctor. When asked if his public speeches throughout the country presented both sides of the discussion touching compulsory national health insurance, this witness answered, "I don't know what you mean by both sides."

This naive answer throws light on the state of mind of people who proudly call themselves progressive intellectuals. They simply do not imagine that any argument could be advanced against the various schemes they are suggesting. As they see it, everybody, without asking questions, must support every project aiming at more and more government control of all aspects of the citizen's life and conduct. They never try to refute the objections raised against their doctrines. They prefer, as Mrs. Eleanor Roosevelt recently did in her column, to call dishonest those with whom they do not agree.

Many eminent citizens hold educational institutions responsible for the spread of this bigotry. They sharply criticize the way in which economics, philosophy, sociology, history, and political science are taught at most American universities and colleges. They blame many teachers for indoctrinating their students with the ideas of all-around planning, socialism, and communism. Some of those attacked try to deny any responsibility. Others, realizing the futility of this mode of defense, cry out about "persecution" and infringement of "academic freedom."

Yet what is unsatisfactory with present-day academic conditions — not only in this country but in most foreign nations — is not the fact that many teachers are blindly committed to Veblenian, Marxian, and Keynesian fallacies, and try to convince their students that no tenable objections can be raised against what they call progressive policies; the mischief is rather to be seen in the fact that the statements of these teachers are not challenged by any criticism in the academic sphere. The pseudoliberals monopolize the teaching jobs at many universities. Only men who agree with them are appointed as teachers and instructors of the social sciences, and only textbooks supporting their ideas are used. The essential question is not how to get rid of inept teachers and poor textbooks. It is how to give the students an opportunity to hear something about the ideas of economists rejecting the tenets of the interventionists, inflationists, socialists, and communists.

1. Methods of the "Progressive" Teachers

Let us illustrate the matter by reviewing a recently published book. A professor of Harvard University edits, with the support of an advisory committee whose members are all, like himself, professors of economics at Harvard University, a series of textbooks, the "Economics Handbook Series." In this series there was published a volume on socialism. Its author, Paul M. Sweezy, opens his preface with the declaration that the book "is written from the standpoint of a Socialist." The editor of the series, Professor Seymour E. Harris, in his introduction, goes a step further in stating that the author's "viewpoint is nearer that of the group which determines Soviet policy than the one which now [1949] holds the reins of government in Britain." This is a mild description of the fact that the volume is from the first to the last page an uncritical eulogy of the Soviet system.

Now it is perfectly legitimate for Dr. Sweezy to write such a book and for professors to edit and to publish it. The United States is a free country — one of the few free countries left in the world — and the Constitution and its amendments grant to everybody the right to think as he likes and to have published in print what he thinks. Sweezy has, in fact, unwittingly rendered a great service to the discerning public. For his volume clearly shows to every judicious reader conversant with economics that the most eminent advocates of socialism are at their wits' end, do not know how to advance any plausible argument in favor of their creed, and are utterly at a loss to refute any of the serious objections raised against it.

But the book is not designed for perspicacious scholars well acquainted with the social sciences. It is, as the editors' introduction emphasizes, written for the general reader in order to popularize ideas and especially also for use in the classroom. Laymen and students who know nothing or very little about the problems involved will draw all their knowledge about socialism from it. They lack the familiarity with theories and facts which would enable them to form an independent opinion about the various doctrines expounded by the author. They will accept all his theses and descriptions as incontestable science and wisdom. How could they be so presumptuous as to doubt the reliability of a book, written, as the introduction says, by an "authority" in the field and sponsored by a committee of professors of venerable Harvard!

The shortcoming of the committee is not to be seen in the fact that they have published such a book, but in the fact that their series contains only this book about socialism. If they had, together with Dr. Sweezy's book, published another volume critically analyzing communist ideas and the achievements of socialist governments, nobody could blame them for disseminating communism. Decency should have impelled them to give the critics of socialism and communism the same chance to represent their views to the students of universities and colleges as they gave to Dr. Sweezy.

On every page of Dr. Sweezy's book, one finds really amazing statements. Thus, in dealing with the problem of civil rights under a socialist regime, he simply equates the Soviet constitution with the American constitution. Both, he declares, are

generally accepted as the statement of the ideals which ought to guide the actions of both the state and the individual citizen. That these ideals are not always lived up to — either in the Soviet Union or in the United States — is certainly both true and important; but it does not mean that they do not exist or that they can be ignored, still less that they can be transformed into their opposite.

Leaving aside most of what could be advanced to explode this reasoning, there is need to realize that the American constitution is not merely an ideal but the valid law of the country. To prevent it from becoming a dead letter there is an independent judiciary culminating in the Supreme Court. Without such a guardian of law and legality, any law can be and is ignored and transformed into its opposite. Did Dr. Sweezy never become aware of this nuance? Does he really believe that the millions languishing in Soviet prisons and labor camps can invoke habeas corpus?

To say it again, Dr. Sweezy has the right — precisely because the American Bill of Rights is not merely an ideal, but an enforced law — to transform every fact into its opposite. But professors who hand out such praise of the Soviets to their students without informing them about the opinions of the opponents of socialism must not raise the cry of witch-hunt if they are criticized.

Professor Harris, in his introduction, contends that "those who fear undue influence of the present volume may be cheered by a forthcoming companion volume on capitalism in this series written by one as devoted to private enterprise as Dr. Sweezy is to socialism." This volume, written by Professor David McCord Wright of the University of Virginia, has been published in the meantime. It deals incidentally also with socialism and tries to explode some minor socialist fallacies, such as the doctrine of the withering away of the state, a doctrine which even the most fanatical Soviet authors relegate today to an insignificant position. But it certainly cannot be considered a satisfactory substitute, or a substitute at all, for a thoroughly critical examination of the whole body of socialist and communist ideas, and the lamentable failure of all socialist experiments.

Some of the teachers try to refute the accusations of ideological intolerance leveled against their universities and to demonstrate their own impartiality by occasionally inviting a dissenting outsider to address their students. This is mere eyewash. One hour of sound economics against several years of indoctrination of errors! The present writer may quote from a letter in which he declined such an invitation:

What makes it impossible for me to present the operation of the market economy in a short lecture — whether fifty minutes or twice fifty minutes — is the fact that people, influenced by the prevailing ideas on economic problems, are full of erroneous opinions concerning this system. They are convinced that economic depressions, mass unemployment, monopoly, aggressive imperialism and wars, and the poverty of the greater part of mankind, are caused by the unhampered operation of the capitalist mode of production.

If a lecturer does not dispel each of these dogmas, the impression left with the audience is unsatisfactory. Now, exploding any one of them requires much more time than that assigned to me in your program. The hearers will think: "He did not refer at all to this" or "He made only a few casual remarks about that." My lecture would rather confirm them in their misunderstanding of the system…. If it were possible to expound the operation of capitalism in one or two short addresses, it would be a waste of time to keep the students of economics for several years at the universities. It would be difficult to explain why voluminous textbooks have to be written about this subject…. It is these reasons that impel me reluctantly to decline your kind invitation.

2. The Alleged Impartiality of the Universities

The pseudoprogressive teachers excuse their policy of barring all those whom they smear as old-fashioned reactionaries from access to teaching positions by calling these men biased.

The reference to bias is quite out of place if the accuser is not in a position to demonstrate clearly in what the deficiency of the smeared author's doctrine consists. The only thing that matters is whether a doctrine is sound or unsound. This is to be established by facts and deductive reasoning. If no tenable arguments can be advanced to invalidate a theory, it does not in the least detract from its correctness if the author is called names. If, on the other hand, the falsity of a doctrine has already been clearly demonstrated by an irrefutable chain of reasoning, there is no need to call its author biased.

A biographer may try to explain the manifestly exploded errors of the person whose life he is writing about by tracing them back to bias. But such psychological interpretation is immaterial in discussions concerning the correctness or falsity of a theory. Professors who call those with whom they disagree biased merely confess their inability to discover any fault in their adversaries' theories.

Many "progressive" professors have for some time served in one of the various alphabetical government agencies. The tasks entrusted to them in the bureaus were, as a rule, ancillary only. They compiled statistics and wrote memoranda which their superiors, either politicians or former managers of corporations, filed without reading. The professors did not instill a scientific spirit into the bureaus. But the bureaus gave them the mentality of authoritarianism. They distrust the populace and consider the State (with a capital S) as the God-sent guardian of the wretched underlings. Only the government is impartial and unbiased. Whoever opposes any expansion of governmental powers is, by this token, unmasked as an enemy of the commonweal. It is manifest that he "hates" the state.

Now if an economist is opposed to the socialization of industries, he does not "hate" the state. He simply declares that the commonwealth is better served by private ownership of the means of production than by public ownership. Nobody could pretend that experience with nationalized enterprises contradicts this opinion.

Another typically bureaucratic prejudice which the professors acquired in Washington is to call the attitudes of those opposing government controls and the establishment of new offices "negativism." In the light of this terminology all that has been achieved by the American individual enterprise system is only "negative"; the bureaus alone are "positive."

There is, furthermore, the spurious antithesis "plan or no plan." Only totalitarian government planning that reduces the citizens to mere pawns in the designs of the bureaucracy is called planning. The plans of the individual citizens are simply "no plans." What semantics!

3. How Modern History Is Taught

The progressive intellectual looks upon capitalism as the most ghastly of all evils. Mankind, he contends, lived rather happily in the good old days. But then, as a British historian said, the Industrial Revolution "fell like a war or a plague" on the peoples. The "bourgeoisie" converted plenty into scarcity. A few tycoons enjoy all luxuries. But, as Marx himself observed, the worker "sinks deeper and deeper" because the bourgeoisie "is incompetent to assure an existence to its slave within his slavery."

Still worse are the intellectual and moral effects of the capitalist mode of production. There is but one means, the progressive believes, to free mankind from the misery and degradation produced by laissez-faire and rugged individualism, viz., to adopt central planning, the system with which the Russians are successfully experimenting. It is true that the results obtained by the Soviets are not yet fully satisfactory. But these shortcomings were caused only by the peculiar conditions of Russia. The West will avoid the pitfalls of the Russians and will realize the welfare state without the merely accidental features that disfigured it in Russia and in Hitler's Germany.

Such is the philosophy taught at most present-day schools and propagated by novels and plays. It is this doctrine that guides the actions of almost all contemporary governments. The American "progressive" feels ashamed of what he calls the social backwardness of his country. He considers it a duty of the United States to subsidize foreign socialist governments lavishly in order to enable them to go on with their ruinous socialist ventures. In his eyes, the real enemy of the American people is big business, that is, the enterprises which provide the American common man with the highest standard of living ever reached in history. He hails every step forward on the road toward all-around control of business as progress. He smears all those who hint at the pernicious effects of waste, deficit spending, and capital decumulation as reactionaries, economic royalists, and Fascists. He never mentions the new or improved products which business almost every year makes accessible to the masses. But he goes into raptures about the rather questionable achievements of the Tennessee Valley Authority, the deficit of which is made good out of taxes collected from big business.

The most infatuated expositors of this ideology are to be found in the university departments of history, political science, sociology, and literature. The professors of these departments enjoy the advantage, in referring to economic issues, that they are talking about a subject with which they are not familiar at all. This is especially flagrant in the case of historians. The way in which the history of the last 200 years has been treated is really a scandal. Only recently, eminent scholars have begun to unmask the crude fallacies of Lujo Brentano, the Webbs, the Hammonds, Tawney, Arnold Toynbee, Elie Halevy, the Beards, and other authors. At the last meeting of the Mont Pelerin Society, the occupant of the chair of economic history at the London School of Economics, Professor T.S. Ashton, presented a paper in which he pointed out that the commonly accepted views of the economic developments of the 19th century "are not informed by any glimmering of economic sense." The historians tortured the facts when they concocted the legend that "the dominant form of organization under industrial capitalism, the factory, arose out of the demands, not of ordinary people, but of the rich and the rulers."

The truth is that the characteristic feature of capitalism was and is mass production for the needs of the masses. Whenever the factory, with its methods of mass production by means of power-driven machines, invaded a new branch of production, it started with cheap goods for the broad masses. The factories turned to the production of more refined and therefore more expensive merchandise only at a later stage, when the unprecedented improvement which they had caused in the masses' standard of living made it reasonable to apply the methods of mass production to better articles as well. Big business caters to the needs of the many; it depends exclusively upon mass consumption. In his capacity as consumer, the common man is the sovereign whose buying or abstention from buying decides the fate of entrepreneurial activities. The "proletarian" is the much-talked-about customer who is always right.

The most popular method of deprecating capitalism is to make it responsible for every condition which is considered unsatisfactory. Tuberculosis and, until a few years ago, syphilis, were called diseases of capitalism. The destitution of scores of millions in countries like India, which did not adopt capitalism, is blamed on capitalism. It is a sad fact that people become debilitated in old age and finally die. But this happens not only to salesmen but also to employers, and it was no less tragic in the precapitalistic ages than it is under capitalism. Prostitution, dipsomania, and drug addiction are all called capitalist vices.

Whenever people discuss the alleged misdeeds of the capitalists, a learned professor or a sophisticated artist refers to the high income of movie stars, boxers, and wrestlers. But who contribute more to these incomes, the millionaires or the "proletarians"?

It must be admitted that the worst excesses in this propaganda are not committed by professors of economics but by the teachers of the other social sciences, by journalists, writers, and sometimes even by ministers. But the source from which all the slogans of this hectic fanaticism spring is the teachings handed down by the "institutionalist" school of economic policies. All these dogmas and fallacies can be ultimately traced back to allegedly economic doctrines.

4. The Proscription of Sound Economics

The Marxians, Keynesians, Veblenians, and other "progressives" know very well that their doctrines cannot stand any critical analysis. They are fully aware of the fact that one representative of sound economics in their department would nullify all their teachings. This is why they are so anxious to bar every "orthodox" from access to the strongholds of their "un-orthodoxy."

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The worst consequence of this proscription of sound economics is the fact that gifted young graduates shun the career of an academic economist. They do not want to be boycotted by universities, book reviewers, and publishing firms. They prefer to go into business or the practice of law, where their talents will be fairly appreciated. It is mainly compromisers, who are not eager to find out the shortcomings of the official doctrine, who aspire to the teaching positions. There are few competent men left to take the place of the eminent scholars who die or reach the retirement age. Among the rising generation of instructors are hardly any worthy successors of such economists as Frank A. Fetter and Edwin W. Kemmerer of Princeton, Irving Fisher of Yale, and Benjamin M. Anderson of California.

There is but one way to remedy this situation. True economists must be given the same opportunity in our faculties which only the advocates of socialism and interventionism enjoy today. This is surely not too much to ask as long as this country has not yet gone totalitarian.