Academic Scribbling and Current Events
It seems like the news is just a never-ending catalog of newer and better ways in which the political class is destroying the world. The US government is spending hundreds of billions of dollars to prop up firms that should be liquidated so that the capital they are tying up can be better used elsewhere, new restrictions on credit cards will hurt the poor's access to credit, and British police are encouraging people to spy on one another and report lavish lifestyles that might be funded by crime. These are just a few among many, many examples. As people celebrate their destroyers, I am left to wonder where people can do the most good. Should we keep slogging along, or should we just give up?
In the late 1940s, a group of classical-liberal scholars formed the Mont Pelerin Society with the goal of carrying the liberal tradition through the storm of post–World War II interventionism, and a speech from their first meeting, in which Friedrich Hayek quotes John Maynard Keynes, suggests an answer:
It is more than likely that from their point of view the practical politicians are right and that in the existing state of public opinion nothing else would be practicable. But what to the politicians are fixed limits of practicability imposed by public opinion must not be similar limits to us. Public opinion on these matters is the work of men like ourselves, the economists and political philosophers of the past few generations, who have created the political climate in which the politicians of our time must move. I do not find myself often agreeing with the late Lord Keynes, but he has never said a truer thing than when he wrote, on a subject on which his own experience has singularly qualified him to speak, that
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. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back. I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. Not, indeed, immediately, but after a certain interval; for in the field of economic and political philosophy there are not many who are influenced by new theories after they are twenty-five or thirty years of age, so that the ideas which civil servants and politicians and even agitators apply are not likely to be the newest. But, soon or late, it is ideas, not vested interests, which are dangerous for good and evil.
While it is discouraging to know that there is probably little we can do to alter the course of current economic policy, there are silver linings in these dark clouds. It is true that buying President Obama a subscription to The Freeman and copies of Atlas Shrugged, Human Action, and Man, Economy, and State probably won't make him realize the error of his ways, but I become increasingly optimistic about our long-run future when I think about how ideas are higher-order factors of production. This diagram adapts Austrian expositions of the structure of production and applies it to the production of ideas and policy.
Public policy doesn't arise overnight, and it occurs in a social and rhetorical context in which people decide, based on implicit or explicit constraints, what is and isn't practicable. Academic scribbling is at the earliest stages of the structure of production, and it doesn't manifest itself in public policy until after it has been assimilated into public rhetoric. James Buchanan was famous for asking job candidates what they were writing that people would be reading in a hundred years. It's certainly a question worth considering. An even better and more ambitious question would be "what ideas are you working on that will someday be so well integrated into the Great Conversation that people won't even be citing you anymore?" No matter the answers, both questions suggest that our efforts in the here and now should be directed toward changing the there and later.
Academics are often asked, "How is this useful? What is the point of this?" Indeed, one can make a strong case that a lot of what we do is either useless or pointless. I think, though, that this focuses too narrowly on the short run. I teach and write not necessarily because of how I think it will affect the value of my portfolio tomorrow, and it isn't just because I'm passionate about ideas and truth. One of the reasons why I do what I do is because I bear some responsibility for the world my children and grandchildren will live in. Today's political disasters are not the result of rent-seeking special interests like the United Auto Workers as much as they are the result of a rhetorical and political environment in which it is thought first that we can flourish as a community of thieves and second that our mutual thievery creates prosperity.
Thus, I follow the advice of others who have come before me and I try not to get too caught up in or depressed by current events. Things are what they are, and there is little if anything I can do to change them over the very short run. My hope is that today's political disasters will spark a passion for ideas, a passion for truth, and a passion for justice. These are dark times, but the foundation has been laid for a classical-liberal renaissance. Policy after policy threatens us with short-run malaise, but I for one remain hopeful and optimistic.
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 Hayek, Individualism and Economic Order, (Chicago, University of Chicago Press, 1948 , p. 108), quoting Keynes, The General Theory of Employment, Interest, and Money (London, 1936, pp. 383-384).
 This idea is borrowed and adapted from a suggestion made by Peter Klein.
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