Translator’s Introduction
Ludwig von Mises wrote Nation, State and Economy in the same year, 1919, as John Maynard Keynes wrote The Economic Consequences of the Peace, a better known diagnosis of and prescription for the postwar economic situation. Mises, writing a few months earlier, presumably had less detailed knowledge of the Versailles Treaty and so was less concerned with its specific provisions. Keynes went into more detail than Mises in estimating such things as the wealth of the belligerents, the amount of destruction suffered, and the capacity of the Germans to pay reparations.
Subprime mortgages are a very small part of the overall mortgage industry in Canada. However, they are quickly growing from their small base. This in itself is not a sign of imminent danger, but it is a sign that the traditional mortgage business is tightening its lending standards and rejecting loans it previously accepted. The tighter government lending requirements on traditional mortgage lenders could have a similar effect to higher interest rates in bringing about a top in the Canadian housing market.
18. Observations on the Cooperative Movement
THE COOPERATIVE IDEA
I. Cooperatives not a Method of World Reconstruction
In spite of their steady expansion and the growth of their turnover, the cooperatives as they exist and operate today are merely dim shadows of what they were designed to be in the ambitious schemes of their first promoters.
19. Some Observations on Current Economic Methods and Policies
I.
If no radical changes in the prevailing political trends and tendencies occur very soon, the system of full government control of human activities will within a few years triumph in all countries this side of the Iron Curtain.
17. Observations on the Russian Reform Movement
The bosses of the Russian Communist Administration are disturbed by the fact that economic conditions in the countries which have not adopted the methods of the Communist International are by far more satisfactory than those in their own country.
If they could succeed in keeping their “comrades” in complete ignorance of the achievements of Western capitalism, they
16. A Hundred Years of Marxian Socialism
I.
In this year 1967, in which the University of Chicago celebrates its seventy-fifth anniversary, the present-day world’s most powerful political movement, Marxism, commemorates the two most important dates of its history.
II. Demonstrated Preference
A Statement of the Concept
Human action is the use of means to arrive at preferred ends. Such action contrasts to the observed behavior of stones and planets, for it implies purpose on the part of the actor. Action implies choice among alternatives. Man has means, or resources, which he uses to arrive at various ends; these resources may be time, money, labor energy, land, capital goods, and so on. He uses these resources to attain his most preferred ends. From his action, we can deduce that he has acted so as to satisfy his most highly valued desires or preferences.
Economists have always been envious of the practitioners of the natural and exact sciences. They have thought that introducing the methods of natural sciences such as a laboratory where experiments could be conducted could lead to a major breakthrough in our understanding of the world of economics.
But while a laboratory is a valid way of doing things in the natural sciences, it is not so in economics. Why is that so?
A laboratory is a must in physics, for there a scientist can isolate various factors relating to the object of inquiry.
15. The Clash of Group Interests
I.
To apply the term “group tensions” to denote contemporary antagonisms is certainly a euphemism. What we have to face are conflicts considered as irreconcilable and resulting in almost continual wars, civil wars, and revolutions.
14. On Equality and Inequality
I.
The doctrine of natural law that inspired the eighteenth century declarations of the rights of man did not imply the obviously fallacious proposition that all men are biologically equal.
