In Ludwig von Mises’s intellectual testament, Memoirs, he discusses his life and work in Europe prior to 1940. In that book he reveals that he first read Carl Menger’s Principles of Economics around Christmastime in 1903. “It was through this book,” Mises relates, “that I became an economist.” Before that, in his first years at the University of Vienna, he was schooled in historicist interventionism.
John Maynard Keynes was wrong about most things, but he was absolutely correct when he stated that “practical men who believe themselves to be quite exempt from any intellectual influence are usually the slaves of some defunct economist.” We might say this about most “elites” in governments today. Even those who have never seriously studied economics are nonetheless greatly influenced by the books and ideas of economists from decades past. This is true of most everyone whether they know it or not.
Human behavior is, to a large extent, socially constructed. People often act based on social norms, expectations, or habits rather than by attempting to ascertain the nature of reality itself. In that context, it is true to say that people’s perceptions of reality are socially constructed, as explained by the Thomas theorem:
For many years, the relationship between interest rates and economic growth has been a major focus of economic theory and policy discussions. According to Austrian theory, interest rates are an important signal in a market economy that balances the time preferences of borrowers and savers, not only a tool that central banks can manage in an effort to maintain economic stability. Severe economic distortions and malinvestments may result from misinterpreting or ignoring this indication.
Deficit spending is not a growth tool. It is the recipe for stagnation.
The latest Congressional Budget Office (CBO) budget and economic outlook estimates show the extent of the challenges of the United States fiscal nightmare.
The CBO expects a budget deficit of $1.9 trillion in 2024, a year of alleged robust economic growth and record tax receipts. They expect revenues to reach $4.9 trillion, or 17.2 percent of GDP, in 2024, which will rise to 18.0 percent by 2027 and remain at that level until 2034.
