Mises Daily Articles
The Mises Institute: The Next 20 Years
How wonderful to be here with so many Members and supporters, scholars in our academic community, students whom the Mises Institute has backed now teaching yet another generation, so many friends of our work. It offers us all a chance to step back and observe what can be done for an ideal even now. And of course we recall those who gave so much but have since died, including Murray N. Rothbard, and, of course, Ludwig von Mises himself.
Mises ended his great book on Socialism, a scientific treatise on economics published in 1922, with a call for a moral crusade against what he decried as the ideology of destructionism. This was the theory of politics that claims to favor a better world but is in fact the spoiler of what our forebears worked so long to create. Destructionism disparages commerce and bourgeois life, exalts the state, and rejects the proposition that the blessings of civilization have come from one source, and one source only: human freedom, with its inseparable twin, peace.
In the place of freedom and peace, destructionism gives us institutions that consume wealth, consume human energy, consume capital, consume lives, and drain away civilization.
Destructionism can take many forms, from terrorism to the construction of imperial states to taxation to the fomenting of war, for all these acts represent attacks on wealth, property, and life itself.
In light of the intellectual and political threat of destructionism, which Mises saw gathering momentum in the early 1920s, he wrote of our moral obligations:
Everyone carries a part of society on his shoulders; no one is relieved of his share of responsibility by others. And no one can find a safe way out for himself if society is sweeping towards destruction. Therefore everyone, in his own interests, must thrust himself vigorously into the intellectual battle. None can stand aside with unconcern; the interests of everyone hang in the result. Whether he chooses or not, every man is drawn into the great historical struggle, the decisive battle into which our epoch has plunged us.
Five years ago, at our 15th anniversary, I would not have begun a talk with that quotation, because much seemed to be heading in the right direction. We were in the upswing of the business cycle, the president was a laughing stock—always a good sign for human freedom---and the forces of liberty were racing ahead of the forces of tyranny. Free enterprise was making great strides in
But here we are today in the world of 2002, two decades after the founding of the Mises Institute, and many of the externals have dramatically changed. The recession continues a full 18 months after the experts said it was over. Government spending is increasing at a rate not seen since the days of LBJ, and deficits are back. The forces of mercantilism and socio-economic regimentation are experiencing political success.
The attacks on commercial enterprise as a profession rival the anti-capitalist hysteria of the 1930s. Since 9-11, the march toward government control in every area of life has continued steadily, and the pace is quickening. The world is on the brink of war that is guaranteed to not bring peace but only more conflict, domination, and hatred. Most alarmingly, public attitudes appear to trope less toward love of liberty and more toward fear, nationalism, and deference to the state. If you are not inclined to defer, you risk being called a traitor.
Indeed, for many of us, these are hard times, times that tempt us to despair. Is there still cause for hope? Yes, I believe so. I've lived long enough to see dramatic political changes appear seemingly out of nowhere. How great it was when the expectations of nearly all political thinkers and commentators—not to speak of economists like Paul Samuelson--were thwarted by the sudden and thrilling collapse of the seemingly impenetrable structure of the Soviet government and all its international holdings.
In our own country, we have seen a loss of faith in the ability of the government to manage our economy. Daily we watch the forces of economic law beat back the central planners. As Mises demonstrated, statism of all varieties is unstable because it wars against human choice, and, moreover, contains within itself the seeds of its own destruction. All of this points to the truth that it is always a great mistake to despair for human freedom, even at the darkest hour. Mises did not, and neither should we.
Yet we must be realistic. The long-term changes required to preserve and further release the blessings of liberty require massive amounts of work, not so much in politics but in the world of ideas. This work must be both broad and specific, academic and popular, scientific and rhetorical. We must work with students, faculty, pastors, businessmen, and citizens. The target audience for education must not be artificially limited but all-embracing.
I am fortunate to live and work in a sector of our world that does just that and thereby provides great hope for liberty and learning in our time. I speak of course of the Mises Institute, which—thanks to men and women like you--has made immense strides in two decades, and, along with the Institute, the intellectual framework that we have daily worked to help grow and thrive.
The Mises Institute was founded to correct one of the great oversights in the history of the 20th century: the neglect of the ideas of Ludwig von Mises, those of his followers, and the
It was the ideology of statism, and it was born in opposition to the market economy and with a political agenda that targeted private property, freedom in commerce, and decentralized political institutions. It flourished in what is wrongly called the Progressive Era, and its proudest achievement was World War I, which destabilized the old order that had helped protect society from the wiles of political fanaticism. The war also showcased a model of central planning that would inspire generations of would-be despots.
The new ideology was not called statism. In each country in which the revolt against freedom took root, the ideology took on a different permutation. In
The links among socialism, fascism, and political developments in the
We must not flatter ourselves into thinking that the poison of totalitarian ideology infected only
The theory of aggregate production, which is the point of the following book, nevertheless can be much easier adapted to the conditions of a totalitarian state than…conditions of free competition and a large degree of laissez-faire. This is one of the reasons that justifies the fact that I call my theory a general theory.
No matter what name it happened to be called in any particular country, statism was indeed the new "general theory" of world politics. The justifications and details matter far less than this general theme. It was the first time in history that the West had come to believe that the state and the state alone should be charged with complete control over society, economy, property, culture, family, and faith. The degree to which the full program of totalitarianism was to be put into effect was to be left to the discretion of political leadership, determined according to the circumstances of time and place.
Evaporating from view was another general theory, one that had developed over millennia and which achieved its scientific apogee in the work of Mises: I speak of the general theory of freedom. Seeing the inevitable absorption of his beloved home into the imperial Third Reich, in 1934, he fled Austria for a safer academic position in Geneva and then, in 1940, racing with his wife Margit across France just in front of the advancing Nazi armies, escaped to Lisbon, and then the United States.
He had completed the great book that would later appear in English as Human Action. It is a brilliant work, perhaps the most important book written in the history of the social sciences. It would deserve to be studied and celebrated had it been written in any epoch, war or peace, freedom or tyranny.
But what is not often appreciated is that Mises wrote this treatise in a strange land at a time when the world he knew was falling apart, in the midst of the consuming fires of war, at a time when all the world agreed on little else but that freedom was a relic and the future belonged to the state.
The core thesis of his book was that government planning is a destructive force, and that civilization needs liberty from the state--any state, all states--to thrive. This argument ran contrary to all conventional wisdom, contrary to the approved doctrine of the smart set in
Complicating matters, Mises had no assurance that his 1940 book would ever receive a wide circulation. There was no guarantee that the publisher could print enough copies to get it into academic libraries, or that the libraries would even be interested.
All of us are accustomed to looking for signs of hope in the political world so that we might believe we have a prospect for success in our efforts, but there were few, if any, signs of hope for Mises, as he wrote those six long years in
Having completed his masterwork, and awaiting its publication, he began an aggressively political book designed for a larger audience, and it was completed in 1938. Its original title was, In the Name of the State. It summed up all political trends of the time. It was this work, written six years before Hayek's Road to Serfdom, that identified the essentially shared ideological traits of the nationalist socialism of the Nazi variety and international socialism of the Communist variety. The book would later appear in English as Omnipotent Government: The Rise of the
Setting sail for the United States in 1940, with no assurance of a teaching position, very little money, and facing a career in another land where statism had also clearly taken hold, any other intellectual might have despaired or even cracked under the pressure. Mises, instead, continued to work and write. He wrote an autobiography of his European years and essays on economics and politics, both popular and scientific. And when an opening appeared in the
Bureaucracy in particular is an interesting case because it was clearly designed, not just as an attack on European bureaucracy, but also on the
Mises never stopped working and teaching, even after his ideas stopped reaching a large audience, even after it appeared that old-style liberalism had no future, even after he had been declared to be wrong about socialism, even after he was refused the academic status that he deserved. In the course of two decades, he had vastly expanded his range of academic work, established economics on a sounder scientific foundation than it had ever had, and stood up courageously to the most evil political trends of his time, perhaps all time.
He had done amazing and heroic things, accomplishments that made him worthy to be included among the great intellectuals in the history of ideas. And yet look what it got him: in those same two decades, he had gone from being a celebrated intellectual force on the Continent to becoming almost an invisible person in the world of ideas, without even a university-paid teaching post.
When his manuscript for Human Action was sent out for review from Yale University Press, the publisher received highly skeptical comments, even from Mises's own former students. Why would they fail to help him? Well, many of them had moved on to high academic posts after making their peace with Keynesianism. Mises's vision of a society and economy that organizes itself without the guidance of omnipotent government seemed hopelessly out of date, and an unwelcome reminder of the gullibility of a previous generation of social scientists. Mises was not on the cutting edge, they believed, and in a world of ideas driven more by politics than by the demands of truth, this was the worst thing one could say about him.
Recently an economist who works for a federal agency commented that when you look at Mises's career, and the nosedive it took after the Second World War, it is clear that Mises was his own worst enemy. This economist suggested that if Mises had played his cards right, not been so dogmatic about his principles, had been more sensitive to the ideological constraints of his time, and had been less aggressively critical of the planning state, he would have done better in his career.
In one sense, this critic is right: Mises was surely aware that he was not advancing himself, and that every manuscript he produced, every book that came to print, was harming his career ever more. But he didn't back off. Instead he chose to do the rarest thing of all in academia: he chose to tell the truth regardless of the cost, regardless of the trends, regardless of how it would play with the powers that be.
Mises might have been his own worst enemy in terms of his professional career, that's true, but he was the friend of truth, of morality, of intellectual integrity, of principled attachments to certain fixed ideals. It seems to me that if we are going to place blame for the awful reality that one of the century's greatest intellectuals received such shabby treatment, it should not be with the man who dared to tell the truth, but with those who tried to make him go away precisely because they did not want to hear the truth or did not understand it.
Did Mises feel remorse about the manner in which he managed his career? In a posthumously published memoir, he repented only of one thing: what he thought of as his willingness to compromise! Never did he regret his intransigence.
The traits that led Mises to do what he did are so rare in academia that they cry out for an explanation. Murray Rothbard once wrote an essay in which he grappled with the issue of why some academics ride with the tide of politics or just keep their heads down during a storm, and why others stand up against trends, take political and personal risks, and fight. In this essay, Rothbard concludes that we cannot fully explain it:
In the ultimate sense, no outside person, no historian, no psychologist, can fully explain the mystery of each individual's free choice of values and actions. There is no way that we can fully comprehend why one man trims his sails to the prevailing winds, why he 'goes along to get along' in the infamous phrase, while another will pursue and champion the truth regardless of cost…. Economic science may be value-free, but men can never be, and Ludwig von Mises never shirked the responsibilities of being human.
As for Mises and his school of old-style liberalism, they did begin a long period of decline after the Second World War. But in considering the intellectual history of the last fifty years, I've long been struck by the place of Murray Rothbard in the constellation of events. Along with a handful of other academics during the late fifties and early sixties, he chose an intellectual path very different from his contemporaries. Rather than go along with the prevailing trends, he charted a different course, one that followed in the tradition of Mises, knowing full well that the choice was an enormously costly one.
When I think of
From his tiny office, he reconstructed the historiography of the American Colonial experience, rewrote American banking history, founded modern libertarianism, extended the theoretical dimensions of the Misesian paradigm, wrote the first general treatise on economics since Human Action, pioneered a new typology of interventionism, pushed out the boundaries of the theory of the free society, corresponded with hundreds of intellectuals around the world, and spread his effective help and good cheer and optimistic outlook as widely as he could. Though he was never in a position where he could direct PhD dissertations, he had wide influence through his books and his personal friendships.
Rothbard faced dangerous trends in public life and battled them heroically. In his youth, he saw positivism and Keynesian become the dominant paradigms in economic theory, and he set out to combat them. At the same time, the intellectual basis of American conservatism underwent a shift from a love of American liberty to an embrace of the warfare state and even the welfare state. He eventually became known at the state's greatest living enemy. And we know the fate of such people in all times.
But he never gave up. In fact, anyone who knew
Later, he helped the Mises Institute get its start, founded a new journal, wrote a massive history of economic thought, and dedicated himself to securing a place for the Austro-libertarian and Misesian schools in academia. We might ask what would have happened to the Misesian legacy—indeed the cause of liberty itself--had he not dedicated himself so completely to the task.
Conjectural history is always risky business, but I think we can say for sure that the Austrian School, not to speak of the Mises Institute, would not be what they are today, and a hope for the future of freedom would not be so much in evidence.
I single out these two men, not because they are the only ones, but because they are exemplars in how to conduct one's life in the face of adversity and very long odds. We gather here tonight facing similarly long odds, and we are all too aware of this fact.
I am often asked what the Mises Institute hopes to accomplish. Both Mises and Rothbard were undoubtedly asked the same question. I think their answer would have been very simple: they hoped to write what is true and do what is right, and to do it with enthusiasm and vigor. As an Institute, we have hoped to create opportunities for other intellectuals in this tradition to do the same. If we do nothing else, that is enough. And yet, it is everything.
It is often said of the Mises Institute what was said of Mises: we are our own worst enemy. We don't have many friends among the powerful. We do not court the media. We do not bend the knee to the political class. We refuse to buy into the political choices the regime presents us. Our intellectual ambitions are deeply contrary to the current trends.
We can plead guilty on every point. The Mises Institute was founded to carry out his vision of an independent source of intellectual support for young minds that have academic vocations. I think of the institute in
As for our teaching programs, the goal has never been to indoctrinate anyone, but rather to make sure that young freedom-minded intellectuals receive the backing, encouragement, and teaching they need to pursue a rich life of writing and research. Their influence works toward overturning the reigning intellectual paradigm.
The Mises Institute has worked to bring this about, and today, the Institute is a life-support system for the worldwide libertarian movement, the top source for scholarship in the tradition of the
Have we made a difference? There can be no doubt. Working one-on-one for two decades, the influence of the Institute has been growing exponentially. Whereas we were once grateful to place one new faculty member per year, such placements are now so common that we can barely track them all. Whereas we once took a leap of faith with every teaching conference we scheduled, we now enjoy the luxury of selecting from the piles of applications for every program we offer. And many of our best applicants are students of our former students, now teaching.
Our journals and books achieve a wider circulation than ever before. Mises.org is indisputably the most highly-trafficked, market-oriented research site on the web, easily beating any comparable organization in the world and crushing even mainstream professional associations. Academic honors granted by our faculty are highly regarded the world over. And most incredibly of all, association with the Mises Institute has become an asset even in job searches.
We couldn't be more pleased about the progress so far, and it inspires us to look to the next twenty years, which are crucial. Many of the most hard-core socialists now teaching will be retiring. Many others will just lose faith in their ideals. The question is: what worldview, what theory of economics, what political ideal, will replace what the left once held out as a model? The
Every day we see minds being changed. Three years ago, it was hard to find economists at major investment houses who even noticed Austrian business-cycle theory. Today, many of the top ones are busy educating themselves. So too in departments of finance, economics, philosophy, history, and political theory. In the marketplace of ideas, our ideas are on the march. The journals, the books, the students, the daily hard work of our faculty and staff, all add up to create something much larger than the sum of its parts, and much larger than we ever dreamed all those years ago.
Anyone who works with or for the Mises Institute can confirm that our goal was never growth alone, never attention alone, never public relations alone, never large conferences alone. We never set out to build a great institution as an end in itself. The goal, the driving passion, of the Mises Institute has been to create the conditions for truth to be told, to make available a setting where freedom is valued and practiced.
If there is anything to be said for the difficult times in which we live, it is that they are a reminder that our mission is far from complete. The forces of destructionism are always waiting for an opportunity to rob us of the blessings of civilization. They do not always hail from far-flung terror groups. Many are tenured in American universities. Many work as editors and producers in our nation's media. Many hold high positions in government. Mises believed that the best way to defeat them was to say what is true. Against the idea of liberty, he said, the fiercest sword of the despot is finally powerless.
The many supporters of the Mises Institute are what make it possible. How grateful we are to them, and to all of you here tonight, and to the thousands of others, from around the country and the world, who are with us in spirit.
All have dedicated themselves to achieving what may appear improbable. To seek such a thing requires a leap of faith. But it is precisely those who take that leap who represent the best hope for the future of the world. As we look to the next twenty years, thanks to the Mises Institute and those who support her, we need not despair, but rather look to a future in which liberty and learning triumph against all odds.
Your faith is evidence of freedom unseen, but, God willing, our children, their children, and every generation after, will live and breathe it. May they never take it for granted.
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Lew Rockwell delivered this talk at the Institute's 20th anniversary celebration in