Has academia become so politicized that teaching good economics, and using politically sensitive illustrations, can lead to threats, fines, penalties, demotion and worse? It certainly seemed so in early February when Hans-Hermann Hoppe, a leading student of Murray Rothbard and senior fellow of the Mises Institute, received an egregious letter from the Provost of his university.
Our image of Svengali derives from a 1894 novel by George Du Maurier (Trilby) that tells of a hypnotist who exercised psychological power over a woman. Insofar as Svengali is in control, she can sing beautifully. But when he is not around, she is reduced to barely functioning at all. Svengali himself derives malicious enjoyment from making people humiliate themselves at his command.
Our times are much like the 1930s, when it was widely assumed that there were only two viable ideological positions: communism or fascism. Liberalism of the old school was considered to be a failure, and not even worth considering. In the name of anticommunism, and lacking a full faith in the workings of freedom, many weak-willed old liberals turned to fascism as a viable alternative.
The Austrian economists—Mises, Rothbard, and Hayek most prominently—were not alone in predicting the baneful effects of central banking and paper money. More than 25 years ago, former US central bank chairman Arthur Burns (who was also Murray Rothbard’s faculty adviser until he took a position at the Fed) gave a shocking speech at the meeting of the International Monetary Fund in Belgrade, on September 30, 1979, entitled “The Anguish of Central Banking.”
Economic downturns are precipitated by credit expansions and contractions but monetary policy cannot alone account for the length, breadth, and shape. This is inspired by other factors.
In his newly-released federal budget, President George W. Bush promises to reduce farm subsidies. Predictably, on the day the budget was made public there were well-choreographed “protests” by all the usual suspects, mostly millionaire corporate farmers camped out at the Mayflower or Four Seasons hotels in Washington, DC for a few days.
Did you have to write out a check to the IRS for $5,581 this past April 15? If you had to do such a thing next year, would you think of it as your civic duty or would you consider it a crime that only the government could get away with?
A Typical Taxpayer
The Bush administration has wrapped up yet another big campaign to bolster support for its Social Security proposal. The latest development is Bush’s suggestion to index benefits for wealthy retirees to prices (rather than wages), which is effectively a cut in promised benefits.
