A popular legend calls Adam Smith the Father of Political Economy and his two great books—The Theory of Moral Sentiments, first published in 1759, and An Inquiry into the Nature and Causes of the Wealth of Nations, first published in 1776—epoch-making in economic history as well as in the evolution of economic thought. However, this is not quite correct. Smith did not inaugurate a new chapter in social philosophy and did not sow on land hitherto left uncultivated.

The most popular of the Marxian teachings is the doctrine of the irreconcilable conflict of social classes.

For Mises, books were important. They were the most effective means for transmitting ideas from generation to generation. He wrote many books himself, and he was constantly urging his students to write books. In almost every lecture he would suggest the titles of several books to read and several books to write.

Mises looked on the opportunity to review a book as more than a chance to discuss one book; it was an excuse for a short essay on economics. Although the books reviewed here may no longer be in print, his comments remain of interest.

In dealing with problems concerned with the economics of mobilization, it is first of all necessary to realize that fiscal policies have reached a turning point.

The most serious dangers for American freedom and the American way of life do not come from without. They are not of a military character. Neither will socialism conquer this country?and, for that matter, the civilized nations of Western Europe?in the shape of an open surrender to the program of the Communist International. Whatever chances socialism may have in the United States are due to the economic policies of our own political parties that gradually undermine the economic and social foundations of American freedom and prosperity.

This country, and with it most of the Western world, is presently going through a period of inflation and credit expansion. As the quantity of money in circulation and deposits subject to check increases, there prevails a general tendency for the prices of commodities and services to rise. Business is booming.

Yet such a boom, artificially engineered by monetary and credit expansion, cannot last forever. It must come to an end sooner or later. For paper money and bank deposits are not a proper substitute for non-existing capital goods.

People by and large know today that a boom brought forth by a policy of credit expansion and “easy money” cannot last forever and must sooner or later lead to a slump. They do not want to be taken by surprise and ruined. They are anxious to learn in time when the turning point will come because they plan to arrange their affairs early enough so as not to be hurt by, or even to profit from, the crash. As they believe that economics is the art of predicting tomorrow’s business conditions, they consult the economists.

The government provides a part of the funds required for rearmament by inflation, that is, by increasing the quantity of money in circulation and the amount of bank balances subject to check.

There has been so much learned talk about the threats and dire consequences of inflation that plain folks begin to be suspicious. Did not the economists of the 1920s, except for a few outsiders whom the others scorned as orthodox doctrinarians, forecast everlasting prosperity? What if their present fears are no better founded than their optimism fifteen years ago? The layman, therefore, has the right to ask the specialist to explain the matter and to do so in simple terms.

When in the 19th century the question was asked: What can be done in order to raise wage rates and thereby to improve the average standard of living of the most numerous class of the population, the economists answered: One has to accelerate the increase of capital as compared with population. This answer infuriated the reformers and socialists. Historian Thomas Carlyle called economics the dismal science, and Karl Marx smeared the economists as bourgeois idiots and sycophants of the exploiters. But such abusive language cannot change the facts.