Sometimes it seems that our entire apparatus of economic education: countless courses, students, professors, textbooks, backed up—in the case of oil pricing—by a decade of experience in the 1970s, is a gigantic waste of time. Certainly it seems that way when we ponder the near-universal reaction to the Kuwait crisis.
Project Head Start is supposed to be the exception to the Great Society rule - a welfare program that actually works. David Broder of the Washington Post calls it “the most effective anti-crime and anti-drug program in the nation.” Sen. Edward Kennedy says we should model a “Marshall Plan” in “early education” on it. The New York Times calls it the “Great Society jewel.”
Certain ways of talking take on a life of their own. In the rituals of habitual speech we sometimes literally forget what we are talking about. We use words in socially plausible patterns but lose the faculty of connecting them with experience. This failing may come from simple mental indolence or from the fear of appearing naive.
In 1928 Herbert Hoover rode the coattails of Calvin Coolidge into the White House, and everyone thought he would hold the line on taxes, for he talked of “individual freedom” and criticized his opponents as “socialists.”
Few occurrences have been more dreaded and reviled in the ‘history of economic thought than deflation. Even as perceptive a hardmoney theorist as Ricardo was unduly leery of deflation, and a positive phobia about falling prices has been central to both Keynesian and monetarist thought.
Governments have always intervened in the economy, but today’s State—armed with modern data collection as well as an interventionist ideology—has taken us to a new level of regulation and taxation.
Faced with this, people find less costly ways to work, produce, and exchange, even if it means doing so unofficially. This is one reason the State can never achieve total economic control—witness the underground economies in the socialist world.
Ludwig von Mises disliked hardboiled detective novels because he always knew who the murderer would be: not the butler, but a prosperous and respected gentleman of high social standing who pretends to virtue, but is actually a hidden criminal and sanctimonious hypocrite. Mises saw egalitarian envy in such tales.
