This interview with Mises Institute President Jeff Deist is reprinted from the October 2014 issue of the Lara-Murphy Report.
Lara-Murphy Report: How did you become interested in Austrian economics?
Jeff Deist: I definitely discovered libertarianism first, which then led me to Austrian economics. I was a hardcore libertarian fairly early in life, going to see Ron Paul at a 1988 Libertarian Party campaign event when I was in college. A few years later my close friend Joe Becker enrolled at UNLV for the express purpose of studying under Professor Murray Rothbard in the graduate economics department, and I was able to sit in on a few of Murray’s classes. I knew nothing about the Austrian School at the time, but it became clear I needed a more comprehensive intellectual foundation — antipathy for the state and a belief that free markets “worked” better was not enough. Reading Rothbard was my start. This is how most young people today first hear about Mises, Rothbard, or Hayek — they already have an interest in libertarian political theory.
They hear references to these great names from their friends, from libertarian think tanks or organizations, from a huge variety of libertarian websites, and from social media, and they begin the process of educating themselves.
The Ron Paul 2012 campaign was a great example of this: people instinctively knew they favored property rights, markets, and peace. They knew they opposed cronyism and the banking cartel. But when Ron mentioned Murray or Mises or Austrian economics or the Fed in a speech, people wanted to go out and find the original sources for themselves. Of course those of us from Generation X remember when vast amounts of free Austrian literature were not just a click away, to put it mildly. If you were lucky your local mall bookstore might have Milton Friedman’s Free to Choose and maybe Hayek’s Road to Serfdom — right next to John Kenneth Galbraith’s The Affluent Society. Mises and Rothbard certainly weren’t available at local libraries or university libraries. All that has changed today.
But obviously the Austrian School predates the modern libertarian movement. That’s why for much of the twentieth century many people read Austrian economics before arriving at philosophical or political libertarianism. The direction was reversed. Smart individuals were absorbing giants like Leonard Read, Henry Hazlitt, and Mises, but they saw themselves as liberals in the classical European tradition of the word. Murray Rothbard deserves much of the credit for building a modern libertarian framework using Austrian economics as the foundation, and creating a bridge for true liberals after the term was hijacked.
LMR: You worked for Ron Paul in his congressional office for several years. I suppose unlike most people in that type of a job, you didn’t have to lie every day at work! Is there any story you can share to illustrate the culture of DC and how you were the oddballs?
JD: My favorite anecdote involves other members of Congress asking us to have Ron sign books, photos, etc., for their constituents. This no doubt galled them, because Ron was a celebrity of sorts while they were unknown. But trust me, the average member of Congress deserves to be forgotten. They are a venal, mean, petty, and self-important bunch, despite the fact that maybe 1 in 20 of their constituents knows their names.
Working for Dr. Paul was a great experience. We (as a staff) never had to worry about Ron being tempted to sell out or cast a safe vote due to political pressure. Ron’s office was far and away the most intellectual and philosophical office on Capitol Hill; the other members of Congress were purely political animals focused either on consolidation of power or self-preservation, depending.
By contrast, we were busy quoting Mises, Rothbard, Bastiat, Tom Woods, Lew Rockwell, Lysander Spooner, you name it, in Ron’s speeches, statements, press releases, and weekly columns. Virtually everyone on staff was at least familiar with Austrian thought, and we used mises.org as a frequent resource.
The degree of groupthink and sheer cowardice in most offices was almost laughable. You have to understand that members of Congress receive voting instructions, talking points, and memos from party “leadership,” and they are expected to then regurgitate these tired slogans and platitudes like trained seals — whether on the House floor, talking to the media, or at constituent meetings.
But Republican leadership left Ron alone, and lobbyists did the same. We were free to promote Austrian economics, liberty, and peaceful non-intervention without the slightest hint of self-censorship. And yet Ron’s district in Texas always reelected him overwhelmingly, even when many of his constituents strenuously disagreed with certain of his positions. They enjoyed having a famous congressman, and they trusted his integrity regardless of their personal political leanings.
Perhaps the best part of working for Ron was meeting thousands of liberty-minded people over the years. If I had to choose two people who really stand out in my memory, I would say James Grant (a true patrician gentleman, brilliant yet humble) and Glenn Jacobs (Kane [the stage name of the professional wrestler — ed.], incredibly thoughtful and giving of his time). But we also met world famous academics and writers, billionaire business owners, stay-at-home moms, soldiers, high school and college students, peace activists, medical marijuana advocates, progressives, conservatives, libertarians, hardcore anarcho-capitalists, nonvoters, and everyone in between. We received a steady stream of visitors from around the country and around the world, generally unannounced. Ron (and often his wife Carol) always took the time to speak with them.
LMR: As a tax attorney specializing in mergers and acquisitions, you also have expert knowledge with the US financial and regulatory system. What’s your take on FATCA (Foreign Account Tax Compliance Act) and the other ways the US government has been tightening the vise on American wealth holders?
JD: I see FATCA as tightening the noose, leading us ever closer to outright capital controls. Control begins with information. FATCA is designed to make it more difficult for US taxpayers to diversify political risk by holding assets abroad, plain and simple. It’s a deterrent, but also a veiled warning to those Americans who dare not to see themselves as subjects of the US state. In a few short decades, a US passport has gone from being one of the most sought-after possessions on earth — something people would risk their lives for — to an albatross around our necks.
The Bank Secrecy Act of 1974 was a terrible development in American history, but few fully understood its potential impact at the time. The feds have always hated the privacy that cash provided, so they cloaked their malicious intentions with false patriotism and began a long smear campaign against financial privacy, especially the offshore variety. Understand that the $10,000 cash transaction reporting requirement in the Act has never been adjusted for inflation; it ought to be at least $46,000 today. Americans should be able to walk into a bank, a car dealership, a jewelry store, or a precious metals shop and conduct business in cash. But instead most of our financial “wealth” consists of easily controllable electronic blips representing bank accounts, stock shares, mutual fund shares, etc. This should be very frightening to anyone paying attention.
LMR: Your current position, of course, is the president of the Mises Institute in Auburn, Alabama, where one of us (Murphy) has spent a great deal of time both learning and teaching Austrian economics. What role does the Mises Institute serve in the intellectual battle for liberty?
JD: We want the Mises Institute to serve as the intellectual home for the worldwide Austro-libertarian revolution. We want to be a place that incubates young (and not so young) minds. We want the Mises Institute to be the MIT or Stanford of the liberty movement — a place where people learn theory and first principles, so that they can go out into the world as entrepreneurial libertarians and apply what they’ve learned in academia, business, civil society, and beyond. And we are moving, slowly but inexorably, toward making virtually everything we offer free to the consumer.
We are a school, but school is being radically redefined. School is not necessarily a place you attend only when you’re young. School is not necessarily a place you attend physically. School does not necessarily involve a one-way lecture and a textbook. School does not necessarily mean long hours of study. One size does not fit all. Some may want to spend whole weeks at the Mises Institute absorbing advanced Austrian theory, reading copious amounts of economics texts, and building an academic career. Others simply may want to monitor our twitter feed and click on the occasional link. This may be all the “education” they need or desire in their busy lives. The point is that people learn in different ways, and our efforts should reflect that.
Our mission is narrower and deeper than most think tanks and advocacy groups. While many wonderful liberty-minded organizations focus on much broader social topics, on the full gamut of libertarian issues, on political activism, or on public policy, we want to be known as the place to get the economics education you can’t get in traditional schools. But we hope what individuals learn at the Mises Institute will spill over into everything they do.
LMR: As our previous questions have indicated, you’ve had an eclectic career, and for that reason probably have seen things that, say, a lifelong investment banker or college professor would overlook. With your unique perspective, do you have any words of wisdom for those who share the Mises Institute’s goals of liberty and peace?
JD: Try to combine an investment banker’s income with a college professor’s lifestyle! Never invest based on your ideology, unless you have very long time horizons. And don’t succumb to Rothbard’s Law, whereby people tend to specialize at what they’re worst at.
