Volume 5, No. 1 (Spring 2002)
George Selgin and Lawrence White have sought to tie their modern free banking school to the views of Ludwig von Mises. Whatever the validity of their own views on the gold standard and fractional-reserve free banking, their assessments of Mises’s positions on these issues are dubious. Mises felt that it was the historical experience of the booms and busts and the propaganda that they were part and parcel of the market economy that did the most to discredit capitalism. It was of the utmost importance, for Mises, to set the record straight on this point and to inoculate the market economy from the boom-bust cycle by purging money and banking of their interventionist elements. In making his case for the gold standard and 100-percent-reserve banking, Mises was making his case for the market economy and, in so doing, striving to rescue Western civilization from its slide into socialism.
