Against the Tide

Foreword

The present volume contains studies that reflect the life’s work of a great humanist and outstanding economist and sociologist who generally has been considered the intellectual father of the economic recovery of Europe. The title, Against the Tide, is well chosen. Wilhelm Röpke not only was a distinguished scholar; he also was a courageous man who steadfastly spoke out against the prevalent trends, irrespective of whether they favored fascism, the welfare state, or Marxism. His work is a good demonstration of Thomas Mann’s assertion that great things are here in spite of opposition. Röpke sought the truth and stood up for his opinion in a way that was dreamed of only by philosophers.

Shortly after the French Revolution, Fichte, who considered true scholarship the highest form of divine grace bestowed on men, stated that the scholar must be the morally best human being of his age, a priest of truth, in the service of truth, committed to truth, willing to do and dare everything for it, to suffer persecution, hatred, and even death. This far-reaching, nearly superhuman, and perhaps truly humane devotion Nietzsche probably had in mind when, having studied Burckhardt’s uncomforting prognoses, he hoped that in the new brave world of secularism scholars would humanize men after Christianity had failed to do so, even at the cost of martyrdom.

Unfortunately, this hope has not come true. In today’s student riots, we wonder whether we should be more ashamed of the insurgent students, of the teachers who support them, or of the professors and academic administrators who allow themselves to be intimidated, thus encouraging a behavior that must lead to the destruction of the very prerequisites of humanism: free instruction and learning. We also wonder about the professors who during the past decade went along with the tide, teaching a “value-free” science and promoting a devaluation of property rights, and thus laid the groundwork for today’s destruction of humanistic values. The failure of today’s academicians to stand up for the values of our civilization, to fight socialist gradualism and communist terrorism, reminds us of the failure of German scholars to fight positivism and the fascist gradualism and terrorism of Hitler’s National Socialists.

Wilhelm Röpke was not one of them. Blue-eyed, tall, blond, rugged looking, born in a part of Germany that is known for its nordic types, not compromised by Marxism, Röpke could have made the most of the opportunities the Hitler movement would have afforded him. He refused the temptation. He was a humanist, not an opportunist. Having spent his formative years in places where Schiller had lived, and also having been influenced by Kant, Röpke became one of the great libertarian humanists of our century.

Röpke not only preached liberty and humanism against the tide; he also brought sacrifices for them. The youngest university professor in the German-speaking world at the age of twenty-four, he soon attained a reputation as a libertarian. It has been said that if during the depression the German government had followed his advice, it could have mastered the economic emergency and Hitler would never have come to power. He denounced the Tat circle, an “action” group of intellectuals opposing capitalism, men who paved the way for National Socialism. He urged farmers not to vote for their enemies, the National Socialists. After the latter had come to power, he kept on attacking them. A few hours before the Reichstag burned, Röpke, comparing a colleague to a gardener in the sense of Voltaire’s famous line in Candide, “mais il faut cultiver notre jardin,” said at his burial that “he probably no longer fitted into our time which is about to destroy the garden of culture and to restore the original wilderness.” In Frankfurt, the birthplace of Goethe, where Röpke gave his last lecture as a German professor, his speech was characterized as much by a defiance of the Hitler regime as by an accurate prognosis of what lay ahead. Shortly thereafter, he became the first professor to leave Germany in protest against that regime.

Following an invitation by Kemal Pascha, Röpke became a professor of economics at Istanbul, where he decisively contributed to the reform of the university. In 1937 he joined the distinguished graduate Institute of International Studies in Geneva, Switzerland. In the summer of 1940, when after the fall of France there was imminent danger of a German invasion of Switzerland, Röpke turned down attractive offers from American institutions in spite of the persecution that would have threatened him and his family in case of an invasion. He preferred fighting Hitler from close by.

But he fought not only the brown danger. Having denounced Marxism as early as he denounced National Socialism, Röpke never wavered in pointing out the red danger. Analyzing André Gide’s report on the Soviet Union, Röpke emphasized the “terror, the culture-murdering uniformization of all life, the servility, the lies of propaganda, the misery” in Russia, a totalitarian state characterized by an absence of freedom and humanism where men lead the lives of insects. When National Socialism had been defeated, Röpke increased his efforts to warn of communism. Just as prior to the Third Reich he had fought not only the National Socialists but also intellectuals who paved the way for them, he now not only denounced Communists but also intellectuals, the “anti-anticommunists” who have aided the spread of communism since World War II, who were blind to the fact that Marxist socialism was as dangerous as National Socialism. He warned the naive and blind whom the Italian communist Togliatti once called “useful idiots,” the professors whom the Bulgarian communist leader Dimitroff accounted to be worth red armies. Adamant in refusing to accept invitations to join professional societies that in his opinion did not sufficiently recognize the danger of communist totalitarianism, Röpke consistently cautioned against arrangements with the Communists, feeling that a true understanding with them and the elimination of mutual distrust would not be possible.

National Socialists and Communists honored Röpke in their own way. The former listed him as one of the professors to be dismissed and banned his book The Social Crisis of Our Time—fortunately only after a few hundred copies had been distributed in Germany. In Hungary The Social Crisis of Our Time rallied the antitotalitarian opposition to such an extent that when a National Socialist government came to power in 1944, it immediately announced that “the time of Röpkeism is now over.” In an encyclopedia published in East Germany, Röpke is described as “liberalist, opponent of the USSR; his theories of ’planned capitalism’ attempt to defend and perpetuate imperialism.” Another verdict runs as follows: “By identifying monopolism and socialism, Röpke succeeds better than any other defender of monopoly capitalism in the design of bourgeois political economy to suppress class struggle and to defame the socialist camp. This makes Röpke’s theory one of the most dangerous bourgeois economic theories.… Röpke thus must be considered an especially shrewd and therefore especially dangerous representative of the modern bourgeois point of view.”

Röpke fought not only against the brown and red tides; he also fought prevalent trends toward less totalitarian planning of the economy. Having denounced the New Deal as early as 1934, he never ceased to take issue with economic planning as proposed by Lord Keynes and his orthodox disciples, who abounded and seemed to have their way in the free world. Through and after World War II, Röpke stood up firmly to the great majority of influential economists when he warned against the advocacy of a planned economy and expressed the fear that planning and collectivism would prevent the economic recovery that he felt was inevitable under a free economy.

The correctness of his opinion was first demonstrated in Germany. His friend Ludwig Erhard, Minister of Economics under Adenauer and later Chancellor, has told how during the war he illegally got hold of Röpke’s books, the contents of which he “devoured like the desert the life-giving water.” Erhard repeatedly emphasized his debt to Röpke when, against the opposition of the military government, he introduced the market economy in West Germany. Röpke’s arguments were decisive in persuading the West German government to reject Keynesian solutions, which were suggested by leading Anglo-Saxon economists. Röpke’s study of the early 1950’s, as to whether the German economic policy was correct, demonstrated the enormous success of the “socially responsible market economy” so convincingly that it deprived Western socialist programs of their appeal. Röpke stressed that the economic recovery of Germany was not at all the “miracle” by which it had become known but the logical result of a free market economy.

After the success of that economic system had been demonstrated in Germany, Röpke’s friend and colleague Luigi Einaudi, the first President of postwar Italy, imitated the German economic policy in his country. It was so successful that even such men as the present President of Italy, Saragat, a Socialist, became admirers of Röpke. In France, Jacques Rueff proposed similar measures, which led to the recovery of France. Other nations in one way or another followed suit. A continent that after World War II lay dying recovered in freedom.

With all his success in realizing his ideas, Röpke did not rest on his laurels. He remained a warner to the very end. When in the late fifties French tendencies toward “programming” and “planification” became known around the world and found disciples especially in the developing nations, Röpke denounced the “economocrats” in unmistakable terms. Wary about the situation in Germany, he continually warned that nothing could be taken for granted and urged the Germans always to remember to reapply the original formulas for success in the realm of economic policy. To the very end, Röpke saw the market economy threatened by intervention-ism, inflation, and the demagoguery of the welfare state.

And yet neoliberalism, of which Röpke was an outstanding exponent, by no means was opposed to all state action. As the name implies, it was not identical to the liberalism of the Manchester School, to a laissez-faire that permitted monopolies. A viable market economy, according to Röpke, requires an effective government to establish and maintain a stable monetary and fiscal system and secure competition by restraining monopolies. While the government should not interfere with the mechanism of supply and demand lest it induce a planned, collectivist economic order, it should intervene to defend the system against abuse. For Röpke, the state no longer had merely the function of a nightwatchman, as in nineteenth-century liberalism. Synthesizing the traditional antitheses of laissez-faire and planning, he favored an order under which the individual enjoys a maximum of freedom and respects the freedom of his fellow men. As he wrote a friend, Lord Acton stressed that power only tends to corrupt. Government is to be preferred over anarchy, including economic anarchy. In a humane society, there is no room for a bellum omnium contra omnes. A market economy is not an end in itself but a means for the welfare of the individual. It is a necessary, but not sufficient, prerequisite for a free, happy, prosperous, and just society: “The fate of the market economy with its admirable and absolutely irreplaceable mechanism of supply and demand will be decided beyond supply and demand.” The market economy could survive only as A Humane Economy. “Made to the measure of man,” that economy would protect the individual against the masses. It would revitalize the culture of the West, which is threatened by a quantitative civilization, burdened by a soulless mechanization, and equalized by a faceless standardization. Röpke complemented neoliberalism with neohumanism. A great spokesman for a free society, he favored “measure and moderation” and was opposed to extremism and ideological exclusiveness.

Like his great predecessor, Adam Smith, Wilhelm Röpke developed; from being an advocate of free enterprise, he became a moral philosopher. Some of his liberal friends were advocates of a more exclusively scientific and technical approach and accused him of being too neoliberal. But perhaps Röpke, believing with Rabelais that “science without conscience means the ruin of the soul,” actually came closer to the genuine liberalism that originally had been conceived as a humanist antidote against oppression of any kind.

When Röpke refused an invitation to join the International Political Science Association because in his opinion that association committed a trahison des clercs by accepting members from communist nations, he wrote: “For more than a quarter of a century I have devoted all my strength to the struggle against the plague of our time which is totalitarianism in all its forms and colors, brown or red, and you know that in this struggle I have not hesitated to expose myself to the greatest dangers and to prefer exile and the abandonment of my career to submission.” Indeed he was, in Julien Benda’s sense, a clerc who kept the faith. And his faith was opposed not only to totalitarianism but also to modern scientism, intellectualism, and moral indifference, to the trend of making intellectual activity an end in itself, of experimenting with men and treating them like raw material in the industrial production process.

Following Fichte’s admonition that “the scholar must forget what he has done as soon as it is done and think only of what else there is to be done,” Röpke became one of the most prolific scholars of his time. When he died, his never-ending courageous struggle against the Zeitgeist was lauded by personalities ranging from the President of Italy and the Chancellor of Germany to representatives of labor. In his Admonition to the Germans, Nietzsche wrote: “We want to be heard, for we speak as warners, and the voice of the warner, whoever he may be and wherever it may sound, is always right; for you who are addressed have the right to decide whether you want to consider your warners honest and wise men who only make noise because you are in danger and who are scared to find you so silent, indifferent and naive.” When Röpke was heard, as in the adoption of a neoliberal economic policy, the results were conspicuous blessings to the poor and rich, the most successful wars against poverty that were ever fought. Now that the world has lost this great sentinel, it should always bear in mind the warnings of his work.

The following essays offer a cross section of that work.