You earn more than your parents did, maybe significantly more. Yet, somehow, the life they built—the house, the retirement account, the sense of getting ahead—feels further away than ever. You’re not imagining it. Something is actually broken.

People generally believe that economics is of interest only to businessmen, bankers, and the like and that there is a separate economics for every group, segment of society, or country. As economics is the latest science to have been developed, it is no wonder that there are many erroneous ideas about the meaning and content of this branch of knowledge.

For over two centuries, Adam Smith has been celebrated as a founding figure of modern economics; The Wealth of Nations, first published in 1776, is still described as the first comprehensive system of political economy. Yet, from an Austrian perspective, that legacy is not a clean inheritance but a poisoned one.

[This article is excerpted from chapter 3 of Classical Liberalism and the Austrian School. Footnote numbering differs from the original.]

Editor’s Note: Murray Rothbard’s new masterwork, The Progressive Era, is now available for purchase. Judge Napolitano’s preface below speaks to why the Progressive Era is so key to our understanding of modern America. This is the first of many selections from the book we will be offering at mises.org in the future. 

[Foreword to Mark Thornton’s new book The Skyscraper Curse: And How Austrian Economists Predicted Every Major Economic Crisis of the Last Century (Auburn, AL: Mises Institute, 2018).]