Rothbard A to Z

CANTILLON EFFECT

Monetary inflation, then, acts as a hidden “tax” by which the early receivers expropriate (i.e., gain at the expense of) the late receivers.

Case Against the Fed, p. 24

… the inflation process necessarily involves a redistribution of wealth and income.

… the privileged beneficiaries of inflation and depreciation are, largely, the central banks themselves and their stockholders, as well as merchants who borrow from these banks, and exporters who benefit by the depreciation of foreign exchange. All these are bought at the expense of the public.

Classical Economics, p. 182

… in a transition period to a new monetary equilibrium there are always gains by those whose selling prices rise faster than their buying prices, and losses by those whose costs rise faster than selling prices, and who are late in receiving the new money. …

… some of these changes in relative income and wealth will be permanent. In short, changes in the money supply are never neutral to the economy, and their effects are never confined to the “level” of prices.

Classical Economics, p. 210

Creation of paper or bank money (“inflation”), therefore, confers a special privilege on some groups, at the expense of the producers and at the expense of the society’s money. The groups that benefit include the first issuers and receivers of the new money, those who sell to them, and generally those whose selling prices rise because of the inflation before a rise in the prices of the goods they have to buy. These groups gain by imposing losses on those to whom the new money is the last to trickle down, that is, those whose buying prices rise before the prices of the goods or services they have to sell.

Conceived in Liberty v. 2, p. 126; p. 624

… the people who first receive new injections of money (whether the counterfeiting be legal or illegal) do benefit first (that is, the counterfeiters and those whom they spend the money on, or, as banks, lend the money to), but they do so at the expense of those who receive the money last and who find the prices of things they have to buy shooting up before the new injection filters down to them. There is a “multiplier” effect of injecting new money, but it is an effect that exploits some people for the benefit of others, and being exploitation, it is also a drag and a burden upon genuine production on the free market.

Egalitarianism as a Revolt Against Nature, pp. 213–14

… while money is a commodity subject to the supply-and-demand determination of value of any other commodity, it differs in one crucial aspect. Other things being equal, an increase in the supply of consumer goods confers a social benefit by raising living standards. But money, in contrast, has only one function: to exchange, now or at some time in the future, for capital or consumer goods. Money is not eaten or used as are consumer goods, nor used up in production as are capital goods. An increase in the quantity of money only serves to dilute the exchange effectiveness of each franc or dollar; it confers no social benefit whatever. In fact, the reason why the government and its controlled banking system tend to keep inflating the money supply, is precisely because the increase is not granted to everyone equally. Instead, the nodal point of initial increase is the government itself and its central bank … early receivers of the new money … benefit at the expense of those down the line of the chain, or ripple effect, who get the new money last, or of people on fixed incomes who never receive the new influx of money.

Ludwig von Mises: Scholar, Creator, Hero, p. 11

… inflation is a form of taxation, in which the government and other early receivers of new money are able to expropriate the members of the public whose income rises later in the process of inflation.

Making Economic Sense, p. 10

… inflation, in other words, not only raises prices and destroys the value of the currency unit; it also acts as a giant system of expropriation of the late receivers by the counterfeiters themselves and by the other early receivers. Monetary expansion is a massive scheme of hidden redistribution.

… Monetary expansion then becomes a giant scheme of hidden taxation …

Making Economic Sense, p. 277

… monetary inflation is counterfeiting, plain and simple. As in counterfeiting, the creation of new money simply diverts resources from producers, who have gotten their money honestly, to the early recipients of the new—to the counterfeiters, and to those on whom they spend their money.

Making Economic Sense, pp. 318–19

A change in the money relation necessarily involves gains and losses because money is not neutral and price changes do not take place simultaneously.

Man, Economy, and State with Power and Market, p. 811

… When a change in the money relation causes prices to rise, the man whose selling price rises before his buying prices gains, and the man whose buying prices rise first, loses. The one who gains the most from the transition period is the one whose selling price rises first and buying prices last. Conversely, when prices fall, the man whose buying prices fall before his selling price gains, and the man whose selling price falls before his buying prices, loses.

Man, Economy, and State with Power and Market, p. 812

The increasing money supply is only a social waste and can only advantage some at the expense of others.

Man, Economy, and State with Power and Market, p. 991

Inflation, then, confers no general social benefit; instead, it redistributes the wealth in favor of the first-comers and at the expense of the laggards in the race.

What Has Government Done to Our Money?, p. 52

CANTILLON, RICHARD

… Richard Cantillon … virtually founded modern economics …

Classical Economics, p. 332

… Richard Cantillon was the first theorist to demarcate an independent area of investigation—economics—and to write a general treatise on all its aspects.

… Cantillon is the “first of the moderns” …

Economic Thought Before Adam Smith, p. 347

Cantillon engaged in the first sophisticated modern analysis of market pricing, showing in detail how demand interacts with existing stock to form prices.

Economic Thought Before Adam Smith, p. 349

One of Cantillon’s remarkable contributions to economic thought is that he was the first to stress and analyze the entrepreneur.

Economic Thought Before Adam Smith, p. 351

While Cantillon, therefore, saw how markets and the location of economic activity were able to regulate themselves harmoniously, he was not a consistent free trader internally just as he was not in the foreign trade area.

Economic Thought Before Adam Smith, p. 354

… was the first, in a pre-Austrian analysis, to understand that money enters the economy as a step-by-step process and hence does not simply increase or raise prices in a homogeneous aggregate.

Economic Thought Before Adam Smith, p. 355

Cantillon held that the rate of interest is determined by the number and interactions of lenders and borrowers, just as the prices of particular goods are determined by the interaction of buyers and sellers.

Economic Thought Before Adam Smith, p. 357

In his analysis of expanding credit lowering the rate of interest, furthermore, Cantillon provides the first hints of the later Austrian theory of the business cycle.

Economic Thought Before Adam Smith, p. 357

… the entire thrust of Cantillon’s work was in a free trade, laissez-faire direction.… Cantillon was the first to show in detail that all parts of the market economy fit together in a “natural,” self-regulative, equilibrating pattern, with existing supply and demand determining prices and wages, and ultimately the pattern of production. Consumer values, furthermore, determined demand, with population adjusting to cultural and economic factors. The equilibrators of the economy were the entrepreneurs, who adjust to and cope with the all-pervasive uncertainty of the market. And if the market economy, despite the “chaos” it might seem to superficial observers, is really harmoniously self-regulating, then government intervention as such is either counterproductive or unnecessary.

Economic Thought Before Adam Smith, pp. 359–60

CAPITAL

Although capital is the previous creation of labor, once in existence it is used by labor to increase production.

Classical Economics, p. 22

More machinery means an increase in productivity of labor and a fall in the cost of production. Such increase in capital is particularly beneficial to the mass of consumers, for competition lowers the price of product as well as the cost of production. Furthermore, increased machinery permits a superior quality of product, and allows the creation of new products which would not have been available under handicraft production. The enormous increase in production and rise in the standard of living releases human energies from the scramble for subsistence to permit cultivation of the arts, even of frivolity …

Classical Economics, p. 23

In the long run, capital will earn the same return in all firms and industries …

Classical Economics, p. 24

… greater capital investment will eventually lower the labor time required to produce a unit of output, but only by increasing the waiting time between the initial point of investment and the eventual unit of consumer goods.

Classical Economics, p. 140

… lengthening the process of production, or the time involved in the process of investing in capital, will enable the use of capital goods of greater physical productivity. But while waiting a longer time will enable one to tap more physically productive processes of production, this benefit must always be weighed against the unwelcome necessity of waiting longer into the future until the return from capital is obtained.… To balance against the greater productivity of waiting longer into the future, the capitalist must charge an interest rate based on the greater desirability of present as against future goods. In short, investors must sacrifice present for future goods.

Classical Economics, p. 141

… capital accumulation increases the amount of capital relative to the supply of labor, and therefore raises the productivity of labor, as well as standards of living in the economy.

Classical Economics, p. 464

Capital moves from low return investments (whether profit rates or interest rates) toward high-return investments until rates of return are equal.

Making Economic Sense, p. 35

… the classes of factors of production are Labor, Land, and the produced factors, which are termed Capital Goods.

Man, Economy, and State with Power and Market, p. 10

… there is only one way by which man can increase his production of consumers’ goods per unit of time—by increasing the quantity of capital goods. Beginning with unaided labor and nature, he must, to increase his productivity, mix his labor energy with the elements of nature to form capital goods. These goods are not immediately serviceable in satisfying his wants, but must be transformed by further labor into lower-order capital goods, and finally into the desired consumers’ goods.

Man, Economy, and State with Power and Market, p. 47

Capital is a way station along the road to the enjoyment of consumers’ goods.

Man, Economy, and State with Power and Market, p. 52

… the role of capital is to advance men in time toward their objective in producing consumers’ goods.

… for any formation of capital, there must be saving—a restriction of the enjoyment of consumers’ goods in the present—and the investment of the equivalent resources in the production of capital goods.

Man, Economy, and State with Power and Market, pp. 52–53

Capital goods have no independent productive power of their own; in the last analysis they are completely reducible to labor and land, which produced them, and time. Capital goods are “stored-up” labor, land, and time; they are intermediate way stations on the road to the eventual attainment of the consumers’ goods into which they are transformed. At every step of the way, they must be worked on by labor, in conjunction with nature, in order to continue the process of production. Capital is not an independent productive factor like the other two.

Man, Economy, and State with Power and Market, p. 58

… capital goods are not independently productive. They are the imputable creatures of land and labor (and time). Therefore, capital goods generate no interest income … no income accrues to the owners of capital goods as such.

Man, Economy, and State with Power and Market, p. 352

Capital goods are vital and of crucial importance in production, but their production is, in the long run, imputable to land, labor, and time factors.

Man, Economy, and State with Power and Market, p. 373

… civilization advances by virtue of additional capital, which lengthens production processes. Greater quantities of goods are made possible only through the employment of more capital in longer processes.

Man, Economy, and State with Power and Market, p. 399

The capital value of capital goods still reduces to wages and the capital value of land.

Man, Economy, and State with Power and Market, p. 495

… a lower pure rate of interest increases the quantity and value of capital goods available.

Man, Economy, and State with Power and Market, p. 549

The capital value of every durable good will equal the discounted value of the sum of future rents to be obtained from the good, the discount being the rate of interest.

Man, Economy, and State with Power and Market, p. 625

Lower time preferences will increase capital investment and thereby lengthen the structure of production. Such lengthening of the production structure, increasing the supply of capital goods, is the only way for man to advance from his bare hands and empty acres of land to more and more civilized standards of living. These capital goods are the necessary way stations on the road to higher total production.

Man, Economy, and State with Power and Market, p. 626

Ultimately, all capital goods are resolvable into labor, land, and time factors.

Man, Economy, and State with Power and Market, p. 679

Capital is the status of productive goods along the path to eventual consumption. In any sort of division-of-labor economy, capital goods are built, not for their own sake by the investor, but in order to use them to produce lower-order and eventually consumers’ goods.

Man, Economy, and State with Power and Market, p. 941

… the great modern accumulation of capital goods is an inheritance from all the net savings of our ancestors. Without them, we would, regardless of the quality of our own moral character, be living in a primitive jungle.

Man, Economy, and State with Power and Market, p. 1038

CAPITALISM

Free-market capitalism is a network of free and voluntary exchanges in which producers work, produce, and exchange their products for the products of others through prices voluntarily arrived at. State capitalism consists of one or more groups making use of the coercive apparatus of the government—the State—to accumulate capital for themselves by expropriating the production of others by force and violence.

Economic Controversies, pp. 655–56

The difference between free-market capitalism and state capitalism is precisely the difference between, on the one hand, peaceful, voluntary exchange, and on the other, violent expropriation.

Economic Controversies, p. 671

Free-market capitalism, the victory of social power and the economic means, is not only the only moral and by far the most productive system; it has become the only viable system for mankind in the industrial era. Its eventual triumph is therefore virtually inevitable.

Economic Controversies, p. 682

There must be some rational mechanism for allocating resources efficiently, for seeing to it that the proper amounts of labor, land, and capital equipment are employed in those areas and in those ways most efficient for satisfying the wants and desires of the mass of consumers. Free-market capitalism not only provides the most smoothly efficient way, it is also the only method that relies solely on voluntary inducements.

Libertarian Forum v. 1, p. 215

Crucial to free enterprise and capitalism is a system of firm rights of private property, with everyone secure in the property that he earns. Also crucial to capitalism is an ethic that encourages and rewards savings, thrift, hard work, and productive enterprise, and that discourages profligacy and cracks down sternly on any invasion of property rights.

Making Economic Sense, pp. 293–94

… firm property right in one’s own self and in the resources that one finds, transforms, and gives or exchanges, leads to the property structure that is found in free-market capitalism.

Man, Economy, and State with Power and Market, p. 1047

Just as free capitalism enormously expanded the amount and variety of consumers’ goods and services available to mankind, so it vastly expanded the number and variety of jobs to be done and the skills that people can develop.

Man, Economy, and State with Power and Market, p. 1317

… it is precisely voluntary exchange and free capitalism that have led to an enormous improvement in living standards.

Man, Economy, and State with Power and Market, p. 1319

CAPITALISTS

During the time of waiting for the eventual product, the workers must be able to live, and this living is precisely what the capitalists provide.

… while the product of labor is off in the future, the capitalist saves money now and hires the worker.

… the worker in effect pays the capitalist a discount from his marginal productivity for the service of supplying money now rather than having to wait for the sale of the product.

Classical Economics, p. 140

… neither capitalists nor workers act in practice as if they are each members of monolithic, conflicting classes. On the contrary, capitalists persist in competing with each other, and workers likewise.

Classical Economics, p. 383

… capitalists, being the peculiarly mobile and dynamic groups in society that can either flourish on the free market or try to obtain state privileges, are, then, particularly ill-suited to a homogeneous class analysis.

Conceived in Liberty v. 1, p. 262; p. 252

The capitalist performs the function of saving money to buy the raw material, and then pays the laborers in advance of sale of the product to the eventual customers.

Economic Controversies, p. 360

The actual world is one not of changeless “givens” but of incessant change and systemic uncertainty. Because of this uncertainty, the capitalist entrepreneur, who stakes assets and resources in attempting to achieve profits and avoid losses, becomes the crucial actor in the economic system …

Economic Controversies, p. 833

… the major driving force of the market economy is not just any entrepreneur but the capitalist-entrepreneur, the man who combines both functions.

Economic Thought Before Adam Smith, p. 395

… since money and capital advances are indispensable to all enterprises, laborers are therefore willing to pay capitalists a discount out of production for the service of having money paid them in advance of future revenue. In short: the interest return on investment … is the payment by laborers to the capitalists for the function of advancing them present money so that they do not have to wait for years for their income.

Economic Thought Before Adam Smith, p. 396

The capitalist, far from somehow depriving the laborer of his rightful ownership of the product, makes possible a payment to the laborer considerably in advance of the sale of the product. Furthermore, the capitalist, in his capacity as forecaster or entrepreneur, saves the laborer from the risk that the product might not be sold at a profit, or that he might even suffer losses.

… the capitalists are conferring a great benefit on these laborers, making possible the entire complex vertical network of exchanges in the modern economy. For they save the money needed to buy the capital goods and to pay the laborers in advance of sale for “producing” them further.

Ethics of Liberty, p. 39

… the capitalists perform an extremely important service to the workers.… As a capitalist, the employer saves money from his possible consumption, and invests the money in paying workers their income in advance of sale of product.

Libertarian Forum v. 1, p. 215

The capitalists earn income in their capacity as purchasers of future goods in exchange for supplying present goods to owners of factors. It is this time element, the result of the various individuals’ time preferences, and not the alleged independent productivity of capital goods, from which the interest rate and interest income arise.

The capitalists earn their interest income, therefore, by supplying the services of present goods to owners of factors in advance of the fruits of their production, acquiring their products by this purchase, and selling the products at the later date when they become present goods. Thus, capitalists supply present goods in exchange for future goods (the capital goods), hold the future goods, and have work done on them until they become present goods. They have given up money in the present for a greater sum of money in the future, and the interest rate that they have earned is the agio, or discount on future goods as compared with present goods, i.e., the premium commanded by present goods over future goods.

Man, Economy, and State with Power and Market, pp. 352–53

… The capitalist-entrepreneurs speculatively advance money to the factors in the expectation of being able to recoup their money with a surplus for interest and profit after sale to the consumers.

Man, Economy, and State with Power and Market, p. 355

… capitalists advance present goods to owners of factors in return for future goods; then, later, they sell the goods which have matured to become present or less distantly future goods in exchange for present goods (money). They have advanced present goods to owners of factors and, in return, wait while these factors, which are future goods, are transformed into goods that are more nearly present than before. The capitalists’ function is thus a time function, and their income is precisely an income representing the agio of present as compared to future goods. This interest income, then, is not derived from the concrete, heterogeneous capital goods, but from the generalized investment of time. It comes from a willingness to sacrifice present goods for the purchase of future goods (the factor services). As a result of the purchases, the owners of factors obtain their money in the present for a product that matures only in the future.

Thus, capitalists restrict their present consumption and use these savings of money to supply money (present goods) to factor owners who are producing only future goods. This is the service—an advance of time—that the capitalists supply to the owners of factors, and for which the latter voluntarily pay in the form of the interest rate.

Man, Economy, and State with Power and Market, p. 374

The pure capitalist, therefore, in performing a capital-advancing function in the productive system, plays a sort of intermediary role. He sells money (a present good) to factor-owners in exchange for the services of their factors (prospective future goods). He holds these goods and continues to hire work on them until they have been transformed into consumers’ goods (present goods), which are then sold to the public for money (a present good). The premium that he earns from the sale of present goods, compared to what he paid for future goods, is the rate of interest earned on the exchange.

Man, Economy, and State with Power and Market, p. 378

… Capitalists’ savings are necessary to increase and deepen the capital structure …

Man, Economy, and State with Power and Market, p. 397

… what maintains capital is gross expenditures and gross investment and not net investment. The capitalists at each stage of production, therefore, have a vital role in maintaining capital through their savings and investment, through heavy savings from gross income.

Man, Economy, and State with Power and Market, p. 399

Every capitalist at every stage, then, demands goods that are more distantly future than the product that he supplies, and he supplies present goods for the duration of the production stage until this product is formed. He is therefore a net supplier of present goods, and a net demander of future goods.

Man, Economy, and State with Power and Market, p. 407

In reality, there is no special class of capitalists set off from laborers and landowners. This is not simply due to the trite fact that even capitalists must also be consumers. It is also due to the more important fact that all consumers can be capitalists if they wish.

Man, Economy, and State with Power and Market, p. 410

As long as a person has any money at all, and he must have some money if he participates in the market society to any extent, he can be a capitalist.

Man, Economy, and State with Power and Market, p. 416

The capitalist-entrepreneur buys factors or factor services in the present; his product must be sold in the future. He is always on the alert, then, for discrepancies, for areas where he can earn more than the going rate of interest.

Man, Economy, and State with Power and Market, p. 510

… the capitalist-entrepreneurs, assume the bulk of the risks of the market and concomitantly relieve laborers of a great deal of risk.

Man, Economy, and State with Power and Market, p. 1313

CARTELS

… just as socialist central planning could not calculate economically, no One Big Firm could own or control the entire economy. …

… One Big Firm would soon find itself suffering severe losses and would therefore disintegrate under this pressure.… If, then, calculation problems begin to arise as markets disappear, this places a free-market limit, not simply on One Big Firm, but even on partial monopolies that eradicate markets. Hence, the free market contains within itself a built-in mechanism limiting the relative size of firms in order to preserve markets throughout the economy.

Economic Controversies, p. 824

Domestic cartels are worthless if the consumer is allowed to buy cheaper substitutes from abroad …

Economic Thought Before Adam Smith, p. 217

Cartels on the market don’t work well without government enforcement, without the government cracking down on competitors who insist on busting the cartel …

Making Economic Sense, p. 281

Even an unchallenged cartel, of course, does not totally control its price or its market; even it is at the mercy of consumer demand. …

… Economic theory and history both tell us that maintaining a cartel, for any length of time, is almost impossible on the free market, as the firms who restrict their supply are challenged by cartel members who secretly cut their prices in order to expand their share of the market as well as by new producers who enter the fray enticed by their higher profits attained by the cartelists.

Making Economic Sense, p. 386

To regard a cartel as immoral or as hampering some sort of consumers’ sovereignty is therefore completely unwarranted.

Man, Economy, and State with Power and Market, p. 641

There is therefore no essential difference between a cartel and an ordinary corporation or partnership.

Man, Economy, and State with Power and Market, p. 643

… a cartel that maintains by voluntary agreement the separate identity of each firm is by nature a highly transitory and ephemeral arrangement and … generally tends to break up on the market.

Man, Economy, and State with Power and Market, p. 644

… a cartel is an inherently unstable form of operation.

Man, Economy, and State with Power and Market, p. 651

… once one strong competitor arises to challenge it, the cartel is doomed. For as the firms in the cartel are bound by production quotas, they must watch new competitors expand and take away sales from them at an accelerating rate. As a result, the cartel must break up under the pressure of the newcomers’ competition.

Man, Economy, and State with Power and Market, pp. 652–53

… there is nothing particularly reprehensible or destructive of consumer freedom in the establishment of a “monopoly price” or in a cartel action. A cartel action, if it is a voluntary one, cannot injure freedom of competition and, if it proves profitable, benefits rather than injures the consumers. It is perfectly consonant with a free society, with individual self-sovereignty, and with the earning of money through serving consumers.

Man, Economy, and State with Power and Market, p. 657

One big cartel would not be able rationally to allocate producers’ goods at all and hence could not avoid severe losses. Consequently, it could never really be established, and, if tried, would quickly break asunder.

In the production sphere, socialism is equivalent to One Big Cartel …

Man, Economy, and State with Power and Market, p. 659

As long as competition is free, unhampered by governmental restrictions, no universal cartel could either exploit labor or remain universal for any length of time.

Man, Economy, and State with Power and Market, p. 661

Compulsory cartels are a forcing of all producers in an industry into one organization, or virtual organization.… Compulsory cartels furnish a haven in which the inefficient firms prosper at the expense of the efficient firms and of the consumers.

Man, Economy, and State with Power and Market, p. 1094

… there is nothing anticompetitive per se about a cartel, for there is conceptually no difference between a cartel, a merger, and the formation of a corporation: all consist of the voluntary pooling of assets in one firm to serve the consumers efficiently. If “collusion” must be stopped, and cartels must be broken up by the government, i.e., if to maintain competition it is necessary that cooperation be destroyed, then the “anti-monopolists” must advocate the complete prohibition of all corporations and partnerships.

Man, Economy, and State with Power and Market, pp. 1118–19

One cartel or one firm could not own all the means of production in the economy, because it could not calculate prices and allocate factors in a rational manner.

Man, Economy, and State with Power and Market, p. 1268

The general public conceives of price-raising and price-fixing agreements to be as easy as a whispered conversation over cocktails at the club. They are, however, extremely difficult to arrange and even harder to maintain. For prices have been driven low by the competition of supply and production; in order to raise prices successfully, the firms will also have to agree to cut production. And there is the sticking point: for no business firm, no entrepreneur, and no manager likes to cut production. What they prefer to do is expand. And, if the businessman is to agree, grudgingly, to cut production, he has to make sure that his competitors will do the same. And then there will be interminable quarrels about how much production each firm is supposed to cut.… And such agreements are very difficult to arrive at.

Progressive Era, p. 57

CAUSE AND EFFECT

… the concepts of cause and effect are part and parcel of natural law analysis. Events in the world can be traced back to the interactions of specific entities. Since natures are given and identifiable, the interactions of the various entities will be replicable under the same conditions. The same causes will always yield the same effects.

Economic Thought Before Adam Smith, p. 4

… knowledge of definite cause-and-effect relations is necessary to any decision to act.

Man, Economy, and State with Power and Market, p. 43n27

In praxeology, the science of human action, however, we know the original cause—motivated action by individuals. This knowledge provides us with true axioms. From these axioms, true laws are deduced. They are deduced step by step in a logical, cause-and-effect relationship. Since first causes are known, their consequent effects are also known. Economics therefore traces unilinear cause-and-effect relations …

Man, Economy, and State with Power and Market, p. 786

CENTRAL BANK

… the most important way that a Central Bank can cartelize its banking system is by increasing the reserves of the banks, and the most important way to do that is simply by buying assets.

Case Against the Fed, p. 64

It should now be crystal clear what the attitude of commercial banks is and almost always will be toward the Central Bank in their country. The Central Bank is their support, their staff and shield against the winds of competition and of people trying to obtain money which they believe to be their own property waiting in the banks’ vaults. The Central Bank crucially bolsters the confidence of the gulled public in the banks and deters runs upon them. The Central Bank is the banks’ lender of last resort, and the cartelizer that enables all the banks to expand together so that one set of banks doesn’t lose reserves to another and is forced to contract sharply or go under. The Central Bank is almost critically necessary to the prosperity of the commercial banks, to their professional career as manufacturers of new money through issuing illusory warehouse receipts to standard cash.

Case Against the Fed, p. 70

No institution is more necessary for State control and manipulation of a modern economy than the Central Bank …

Economic Controversies, p. 714

Individual banks by themselves, not artificially bolstered by central banks, have a tendency to collapse before they can inflate very far: either from each expanding bank’s losing cash (gold or paper) to other banks, or from runs on the banks. The Central Bank can make sure that all banks expand together, can furnish needed reserves to banks throughout the country and lend to banks in trouble, and can thereby bring about a much greater, and centrally coordinated, expansion of the money supply.

Economic Controversies, p. 716

Abolition of the Federal Reserve would mean that its gold supply now kept in Treasury depositories would have to be disgorged and returned to private hands. But this gives us the clue to the proper definition of a gold dollar. For in order to liquidate the Federal Reserve and remove the gold from its vaults, and at the same time tie gold to the dollar, the Federal Reserve’s gold must be revalued and redefined so as to be able to exchange it, one for one, for dollar claims on gold.

Economic Controversies, pp. 771–72

Banks can only expand comfortably in unison when a Central Bank exists, essentially a governmental bank, enjoying a monopoly of government business, and a privileged position imposed by government over the entire banking system. It is only when central banking got established that the banks were able to expand for any length of time and the familiar business cycle got underway in the modern world.

Economic Depressions: Their Cause and Cure, p. 27

Central banking works like a cozy compulsory bank cartel …

Economic Depressions: Their Cause and Cure, p. 28

… the Fed is an organized cartel of banksters, who are creating inflation, ripping off the public, destroying the savings of the average American.

Irrepressible Rothbard, p. 41

The key lever in the creation of new money and the expansion of the money supply, then, is the total of bank reserves. These are under the complete control of the Federal Reserve Board. …

And so the major culprit of the inflation has been the Federal Reserve Board, which has been merrily buying government securities on the open market and thereby levering the money supply ever upward.

Libertarian Forum v. 1, p. 230

The Federal Reserve is not some sort of mystical entity separate and apart from the government of the United States; on the contrary, it is a vital part of that government. It has never been “apart” from politics, but necessarily hip deep in political decisions.… The very idea of insulating “government” from “politics” only makes sense as a means of insulating dictatorial rule from any kind of popular check or influence.

Libertarian Forum v. 2, p. 806

The dollar must be denationalized, taken out of the hands of the Fed and the Treasury. The only way to do that is to redefine the dollar as a weight of gold (i.e., “return to the gold standard”), and then redeem the hoard of gold that the federal government stole from us in 1933 and has never returned. The Fed should then be abolished, with banks set free, but held to the strictest market standards of outlawry of fraud, and forced to close their doors at the slightest refusal to redeem their deposits on demand (or whenever they fall due).

Pending the gold standard and abolition of the Fed, the very least to be done would be passing a law freezing the Fed permanently. That is, prohibiting the Fed from buying any assets ever again (or making any further loans, or lowering reserve requirements). If the Fed cannot politically be abolished outright, then it should be frozen into innocuous desuetude.

Libertarian Forum v. 2, p. 1076

… the government and its central bank act precisely as would a Grand Counterfeiter, with very similar social and economic effects.

Making Economic Sense, p. 276

… the Federal Reserve and other central banking systems act as giant government creators and enforcers of a banking cartel; the Fed bails out the banks in trouble, and it centralizes and coordinates the banking system …

Making Economic Sense, p. 283

The Federal Reserve, being in default, should be liquidated …

Making Economic Sense, p. 287

… we must abolish central banking …

Making Economic Sense, p. 294

Whatever the Fed does, it unerringly makes matters worse. First it pumps in a great deal of new money because, in the depth of recession, prices go up very little in response. Emboldened by this “economic miracle,” it pumps more and more new money into the system. Then, when prices finally start accelerating, it tries to prolong the inevitable and thereby only succeeds in delaying market adjustments.

Making Economic Sense, p. 335

The central bank, while often nominally owned by private individuals or banks, is run directly by the national government. Its purpose, not always stated explicitly, is to remove the competitive check on bank credit provided by a multiplicity of independent banks. Its aim is to make sure that all the banks in the country are coordinated and will therefore expand or contract together—at the will of the government.

Man, Economy, and State with Power and Market, p. 1015

The crucial way by which governments have established central bank control over the commercial banking system is by granting the bank a monopoly of the note issue in the country.… Such nationalizing of the note-issue business forces the commercial banks to go to the central bank whenever their customers desire to exchange demand deposits for paper notes. To obtain notes to furnish their clients, commercial banks must buy them from the central bank. Such purchases can be made only by selling their gold coin or other standard money or by drawing on the banks’ deposit accounts with the central bank.

Since the public always wishes to hold some of its money in the form of notes and some in demand deposits, the banks must establish a continuing relationship with the central bank to be assured a supply of notes. Their most convenient procedure is to establish demand deposit accounts with the central bank, which thereby becomes the “bankers’ bank.” These demand deposits (added to the gold in their vaults) become the reserves of the banks.

Man, Economy, and State with Power and Market, p. 1015

When the government “goes off” the gold standard, central bank notes then become legal tender and virtually the standard money. It then cannot possibly fail, and this, of course, practically eliminates limitations on its credit expansion.

Man, Economy, and State with Power and Market, p. 1017

… the essential purpose of central banking is to use government privilege to remove the limitations placed by free banking on monetary and bank credit inflation.

Mystery of Banking, p. 125

The Central Bank is a bankers’ bank. Just as the public keeps checking accounts with commercial banks, so all or at least most of them keep checking accounts with the Central Bank.

Mystery of Banking, p. 126

… under central banking, all banks can expand together, on top of new reserves that are pumped in, across the board, by the benevolent Central Bank. …

… The Central Bank eliminates hard and noninflated money, and substitutes a coordinated bank credit inflation throughout the nation. That is precisely its purpose. In short, the Central Bank functions as a government cartelizing device to coordinate the banks so that they can evade the restrictions of free markets and free banking and inflate uniformly together. The banks do not chafe under central banking control; instead, they lobby for and welcome it. It is their passport to inflation and easy money.

Mystery of Banking, pp. 133–34

… Central Banks try to serve as an ultimate “safety net” for banks …

Mystery of Banking, p. 149

… the Central Bank should be frozen, and prevented from making further loans or especially open market purchases. Period.

Mystery of Banking, p. 158

… the Fed was largely fashioned by the banks as a cartelization device.

Progressive Era, p. 464

Some critics of the Federal Reserve assert that it is really and simply a private central bank, since it is owned wholly by its member banks and it makes profits from its policies. But this view ignores the fact that all profits made by the Banks are now taxed away by the treasury. The point of the cartel is not to make profits directly as shareholders of each Reserve Bank, but to benefit from the cartelizing and inflationary policies of the entire system.

At the same time, those who maintain that the Federal Reserve System is a wholly government-controlled institution overstate the case.

Progressive Era, pp. 478–79

The Federal Reserve System, like all central banking systems, is inherently inflationary.

Progressive Era, p. 479

… the Federal Reserve was designed not to curb the allegedly inflationary tendencies of freely competing banks but to do precisely the opposite: to enable the banks to inflate uniformly without worrying about calls for redemption by noninflating competitors. In short, the Federal Reserve was designed to act as a government-sponsored and enforced cartel promoting the income of banks by preventing free competition from doing its constructive work on behalf of the consumer.

Progressive Era, p. 511

A Central Bank attains its commanding position from its governmentally granted monopoly of the note issue. This is often the unsung key to its power.

What Has Government Done to Our Money?, p. 68

In a free-banking system, inflation by any one bank would soon lead to demands for redemption by the other banks, since the clientele of any one bank is severely limited. But the Central Bank, by pumping reserves into all the banks, can make sure that they can all expand together, and at a uniform rate. If all banks are expanding, then there is no redemption problem of one bank upon another, and each bank finds that its clientele is really the whole country. In short, the limits on bank expansion are immeasurably widened, from the clientele of each bank to that of the whole banking system. Of course, this means that no bank can expand further than the Central Bank desires. Thus, the government has finally achieved the power to control and direct the inflation of the banking system.

What Has Government Done to Our Money?, pp. 72–73

… the act of establishing a Central Bank greatly multiples the inflationary potential of the country.

What Has Government Done to Our Money?, p. 73

CHANGE

We live necessarily in a society of continual and unending change, change that can never be precisely charted in advance. …

Changes, then, take place continually in all spheres of the economy. Consumer tastes shift; time preferences and consequent proportions of investment and consumption change; the labor force changes in quantity, quality, and location; natural resources are discovered and others are used up; technological changes alter production possibilities; vagaries of climate alter crops, etc. All these changes are typical features of any economic system. In fact, we could not truly conceive of a changeless society, in which everyone did exactly the same things day after day, and no economic data ever changed. And even if we could conceive of such a society, it is doubtful whether many people would wish to bring it about.

America’s Great Depression, pp. 4–5

The actual world is one not of changeless “givens” but of incessant change and systemic uncertainty. Because of this uncertainty, the capitalist entrepreneur, who stakes assets and resources in attempting to achieve profits and avoid losses, becomes the crucial actor in the economic system, an actor who can in no way be portrayed by a world of general equilibrium.

Economic Controversies, p. 833

All human choices are continually changing as a result of changing valuations and changing ideas …

Man, Economy, and State with Power and Market, p. 7

The individual must determine subjectively for himself whether he is better or worse off as a result of any change. His preference can only be expressed in terms of simple choice, or rank.

Man, Economy, and State with Power and Market, p. 19

… the real world of action is one of continual change. Individual value scales, technological ideas, and the quantities of means available are always changing. These changes continually impel the economy in various directions.

Man, Economy, and State with Power and Market, p. 321

… since the data of human action are always changing, there are no precise, quantitative relationships in human history.

Man, Economy, and State with Power and Market, p. 324

CHARITY

The true humanitarian rejoices when the people he helps feel ready to assert their independence and to strike out on their own; for isn’t this independence essential to being truly human?

Left and Right, pp. 307–08

The sincerity of the State’s desire to promote charity toward the poor may be gauged by two perennial drives of government: to suppress “charity rackets” and to drive individual beggars off the streets because the “government makes plenty of provision for them.” The effect of both measures is to cripple voluntary individual gifts of charity and to force the public to route its giving into the channels approved by, and tied in with, government officialdom.

Man, Economy, and State with Power and Market, pp. 943–44

A tax on gifts and bequests has the further effect of penalizing charity and the preservation of family ties. It is ironic that some of those most ardent in advocating taxation of gifts and bequests are the first to assert that there would never be “enough” charity were the free market left to its own devices.

Man, Economy, and State with Power and Market, p. 1185

Government is the very negation of charity, for charity is uniquely an unbought gift, a freely flowing uncoerced act by the giver.

Man, Economy, and State with Power and Market, p. 1228

The reason that anyone contributes voluntarily to a charity is precisely the benefit that he obtains from it. Yet benefit can be considered only in a subjective sense. It can never be measured. The fact of subjective gain, or benefit, from an act is deducible from the fact that it was performed. Each person making an exchange is deduced to have benefited (at least ex ante). Similarly, a person who makes a unilateral gift is deduced to have benefited (ex ante) from making the gift. If he did not benefit, he would not have made the gift.

Man, Economy, and State with Power and Market, p. 1229

… it is hardly “charity” to take wealth by force and hand it over to someone else. Indeed, this is the direct opposite of charity, which can only be an unbought, voluntary act of grace. Compulsory confiscation can only deaden charitable desires completely, as the wealthier grumble that there is no point in giving to charity when the State has already taken on the task.

Man, Economy, and State with Power and Market, p. 1319

Whereas the opportunity for voluntary charity acts as a spur to production by the able, coerced charity acts as a drain and a burden upon production. In fact, in the long run, the greatest “charity” is precisely not what we know by that name, but rather simple, “selfish” capital investment and the search for technological innovations.

Man, Economy, and State with Power and Market, p. 1320

Statists, in fact, are really opposed to charity. They often argue that charity is demeaning and degrading to the recipient, and that he should therefore be taught that the money is rightly his, to be given to him by the government as his due … granting him the moral and legal right to mulct his fellows increases his moral degradation instead of ending it, for the beneficiary is now further removed from the production line than ever. An act of charity, when given voluntarily, is generally considered temporary and offered with the object of helping a man to help himself. But when the dole is ladled out by the State, it becomes permanent and perpetually degrading, keeping the recipients in a state of subservience.

Man, Economy, and State with Power and Market, pp. 1320–21

I consider it a tribute to the moral qualities of an individualist society that private charity and philanthropy helps the unfortunate people in our midst. Private philanthropy is the direct expression of the great Christian principle of the brotherhood of man and the Golden Rule.

Private philanthropy indeed is the only valid expression of these Christian ethical principles; compulsory charity through “social legislation” is the exact contrary: it is the evil imposition of force by one group on another.

Rothbard vs. the Philosophers, p. 55

CHILDREN

Every human infant comes into the world devoid of the faculties characteristic of fully-developed human beings. This does not mean simply the ability to see clearly, to move around, to feed oneself, etc.; above all, it means he is devoid of reasoning power—the power that distinguishes man from animals. But the crucial distinction between the baby and other animals is that these powers, in particular the ability to reason, are potentially within him. The process of growing up is the process of the development of the child’s faculties. From a state of helplessness and incompetence such as few newly born animals are burdened with, the infant grows up to the glory of the full stature of an adult.

Education: Free and Compulsory, p. 1

… the growing child, working with his environment, develops ends and discovers means to achieve them. His ends are based on his own personality, the moral principles he has concluded are best, and his aesthetic tastes; his knowledge of means is based on what he has learned is most appropriate. This body of “theory” in which he believes, he has acquired with his reasoning powers, either from the direct experience of himself or others, or from logical deduction by himself or by others. When he finally reaches adulthood, he has developed his faculties to whatever extent he can, and has acquired a set of values, principles, and scientific knowledge.

Education: Free and Compulsory, p. 2

The only logical alternative to parental “ownership” of the child is for the State to seize the infant from the parents and to rear it completely itself. To any believer in freedom this must seem a monstrous step indeed.

Education: Free and Compulsory, p. 10

It is only commonsense biological and social insight to realize that youths win their way into society through a process of apprenticeship; youths know less and have less experience than mature adults, and so it should be clear why they tend to have less status and authority than their elders. But to accept this would be to cast the egalitarian creed into some substantial doubt …

Egalitarianism as a Revolt Against Nature, p. 11

… the overriding fact of parent-child relations is that the child lives on the property of his parents. The child lives either in a house owned by his parents or in an apartment rented by them. Therefore, as in the case of any other “guest” living on someone else’s property, he must obey the rules set down by the property owners for remaining on that property. In short, the parents have the perfect legal and moral right to lay down rules for their children.… Furthermore, there is nothing morally wrong with laying down such rules. On the contrary, any property owner is bound to lay down rules for the use of his property.

… it is perfectly proper, legally and morally, for the parents to prohibit noise, offensive behavior, etc., as part of the rules for persons living on their property. When the child becomes older, it is equally legitimate for the parents to insist on curfews, to prohibit noise, wild parties, sexual hijinks, etc., on the property as well.

Egalitarianism as a Revolt Against Nature, pp. 146–47

… the child must always have, regardless of age, the absolute freedom to run away, to get out from under. It is grotesque to think that the parents can actually own the child’s body as well as physical property; it is advocating slavery and denying the fundamental right of self-ownership to permit such ownership of others, regardless of age. Therefore, the child must always be free to run away; he then becomes a self-owner whenever he chooses to exercise his right to run-away freedom.

Egalitarianism as a Revolt Against Nature, p. 147

… most children will, upon growing up, seek to create their own environment by leaving the parental nest. That is the way of nature, from the animal kingdom to man.

Egalitarianism as a Revolt Against Nature, p. 148

During the early years of babyhood, when the child is helpless and has few if any powers of self-ownership, he indeed becomes a kind of property of his creators, his parents.… the act of creation gives the parent, and not outside adults, jurisdiction over the baby. And yet, this ownership cannot be absolute, cannot involve the right of the parent to mutilate, maim, or murder the child, for this would be criminal aggression against the body of the child, who, being an independent human entity, cannot come under the absolute jurisdiction of anyone. The role of the parent, then, is to be, not an absolute owner, but a trustee-owner or guardian, with the right to regulate the child but not to aggress against his person (as by forcibly preventing him from running away).

Egalitarianism as a Revolt Against Nature, p. 149

Parents, then, have not only the moral right but the moral obligation and responsibility to raise their young children in preparation for adulthood, to care for, shelter, educate, and train their persons and their character.

Egalitarianism as a Revolt Against Nature, p. 152

Parents, then, have the legal right and the moral obligation to nurture their children as guardians, as trustee-“owners”; no law or enforcing agency has the right to seize these children from their creators or regulate them except as they are being aggressed against by their parents. Above all, every child must always have the right to run away to freedom, to get out from under parental property—otherwise enslavement is indeed involved.

Egalitarianism as a Revolt Against Nature, p. 154

What is needed, above all, is the liberation of both child and parent from the domination of the State apparatus.

Egalitarianism as a Revolt Against Nature, p. 155

… a newborn babe is in no natural sense an existing self-owner, but rather a potential self-owner.

Ethics of Liberty, p. 97

The proper groundwork for analysis of abortion is in every man’s absolute right of self-ownership. This implies immediately that every woman has the absolute right to her own body, that she has absolute dominion over her body and everything within it. This includes the fetus.

Ethics of Liberty, p. 98

… the parents—or rather the mother, who is the only certain and visible parent—as the creators of the baby become its owners. A newborn baby cannot be an existent self-owner in any sense. Therefore, either the mother or some other party or parties may be the baby’s owner, but to assert that a third party can claim his “ownership” over the baby would give that person the right to seize the baby by force from its natural or “homesteading” owner, its mother. The mother, then, is the natural and rightful owner of the baby, and any attempt to seize the baby by force is an invasion of her property right.

Ethics of Liberty, p. 99

… the parental property right must be limited in time. …

… even from birth, the parental ownership is not absolute but of a “trustee” or guardianship kind. In short, every baby as soon as it is born and is therefore no longer contained within his mother’s body possesses the right of self-ownership by virtue of being a separate entity and a potential adult. It must therefore be illegal and a violation of the child’s rights for a parent to aggress against his person by mutilating, torturing, murdering him, etc.

Ethics of Liberty, p. 100

A parent does not have the right to aggress against his children, but also that the parent should not have a legal obligation to feed, clothe, or educate his children, since such obligations would entail positive acts coerced upon the parent and depriving the parent of his rights. The parent therefore may not murder or mutilate his child, and the law properly outlaws a parent from doing so. But the parent should have the legal right not to feed the child, i.e., to allow it to die. The law, therefore, may not properly compel the parent to feed a child or to keep it alive. (Again, whether or not a parent has a moral rather than a legally enforceable obligation to keep his child alive is a completely separate question.)

Ethics of Liberty, pp. 100–01

… the child has his full rights of self-ownership when he demonstrates that he has them in nature—in short, when he leaves or “runs away” from home. Regardless of his age, we must grant to every child the absolute right to run away.… Parents may try to persuade the runaway child to return, but it is totally impermissible enslavement and an aggression upon his right of self-ownership for them to use force to compel him to return. The absolute right to run away is the child’s ultimate expression of his right of self-ownership, regardless of age.

Ethics of Liberty, p. 103

… the purely free society will have a flourishing free market in children. Superficially, this sounds monstrous and inhuman. But closer thought will reveal the superior humanism of such a market. For we must realize that there is a market for children now, but that since the government prohibits sale of children at a price, the parents may now only give their children away to a licensed adoption agency free of charge. This means that we now indeed have a child-market, but that the government enforces a maximum price control of zero, and restricts the market to a few privileged and therefore monopolistic agencies. The result has been a typical market where the price of the commodity is held by government far below the free-market price: an enormous “shortage” of the good. The demand for babies and children is usually far greater than the supply, and hence we see daily tragedies of adults denied the joys of adopting children by prying and tyrannical adoption agencies. In fact, we find a large unsatisfied demand by adults and couples for children, along with a large number of surplus and unwanted babies neglected or maltreated by their parents. Allowing a free market in children would eliminate this imbalance, and would allow for an allocation of babies and children away from parents who dislike or do not care for their children, and toward foster parents who deeply desire such children. Everyone involved: the natural parents, the children, and the foster parents purchasing the children, would be better off in this sort of society.

Ethics of Liberty, pp. 103–04

The rights of children, even more than those of parents, have been systematically invaded by the state. Compulsory school attendance laws, endemic in the United States since the turn of this century, force children either into public schools or into private schools officially approved by the state. Supposedly “humanitarian” child labor laws have systematically forcibly prevented children from entering the labor force, thereby privileging their adult competitors.

Ethics of Liberty, p. 107

… either parents run kids, or the state runs them …

Irrepressible Rothbard, p. 291

… it should be up to the parents to explain the facts of life to kids.

Irrepressible Rothbard, p. 365

… every family has not only the right but the moral duty to instruct its children in the proper bourgeois virtues and the “Protestant ethic.”

Libertarian Forum v. 1, p. 448

If potential kidnappers are put on clear warning from the very start that no demands they make will be satisfied by one iota, then kidnappings will cease before they begin, and the lives of their victims and family will not be shattered. In the long-run, this is the least “hardhearted” position to take, in addition to clearly being the only one consonant with justice. Evil and crime must never be rewarded.

Libertarian Forum v. 1, p. 458

Parents do no own their children … the idea of divine right of parents must be combatted …

Libertarian Forum v. 2, p. 746

CHOICE

… each human being knows universally from introspection that he chooses.

Economic Controversies, p. 4

Action is the result of choice among alternatives, and choice reflects values, that is, individual preferences among these alternatives.

Economic Controversies, p. 289

In economics, however, we are only interested in values revealed through choices.… The fact of ranking is what matters for economics …

Economic Controversies, p. 305

… human beings have, and ought to enjoy, absolute freedom of individual choice. We all have the capacity to do and be many things that we may not choose to undertake.

Libertarian Forum v. 2, p. 847

Action takes place by choosing which ends shall be satisfied by the employment of means. Time is scarce for man only because whichever ends he chooses to satisfy, there are others that must remain unsatisfied. When we must use a means so that some ends remain unsatisfied, the necessity for a choice among ends arises.

Man, Economy, and State with Power and Market, p. 5

All action involves the employment of scarce means to attain the most valued ends. Man has the choice of using the scarce means for various alternative ends, and the ends that he chooses are the ones he values most highly.

Man, Economy, and State with Power and Market, p. 17

The choice of which ends to include in the actor’s value scale and the assignment of rank to the various ends constitute the process of value judgment. Each time the actor ranks and chooses between various ends, he is making a judgment of their value to him.

Man, Economy, and State with Power and Market, p. 18

… value scales do not exist in a void apart from the concrete choices of action.

Man, Economy, and State with Power and Market, p. 33

Every aspect of action has involved a choice among alternatives—a giving up of some goods for the sake of acquiring others.

Man, Economy, and State with Power and Market, p. 71

The ranking on his value scale depends entirely on the voluntary choice of each individual.

Man, Economy, and State with Power and Market, p. 214

… the establishment of money tremendously broadens the range of choice open to everybody.

Man, Economy, and State with Power and Market, p. 279

In the real world of scarce resources in relation to possible ends, all production involves choice and the allocation of factors to serve the most highly valued ends.

Man, Economy, and State with Power and Market, p. 638

In praxeology we are interested only in preferences that result in, and are therefore demonstrated by, real choices, not in the preferences themselves.

Man, Economy, and State with Power and Market, p. 701

CLASSES

… antagonistic classes, the rulers and the ruled, can only be created by accession to State privilege; it is the use of the State instrument that brings these antagonistic classes into being.… businessmen and workers are in harmony—as are everyone else—in the free market and free society, and it is only through State intervention that antagonistic classes are created.

Betrayal of the American Right, p. 20

… all classes have a joint interest in the operations of the free market.

Classical Economics, p. 6

The ruling class is whichever group has managed to seize state power; the ruled are those groups who are taxed and regulated by those in command. Class interest, then, is defined as a group’s relation to the state. State rule, with its taxation and exercise of power, controls, and conferring of subsidies and privileges, is the instrument that creates conflicts between the rulers and the ruled. What we have, then, is a “two-class” theory of class conflict, based on whether a group rules or is ruled by the state. On the free market, on the other hand, there is no class conflict, but a harmony of interest between all individuals in society cooperating in and through production and exchange.

Classical Economics, pp. 75–76

A “class” is a set of entities with one identifiable thing in common.… A “social class” is a class of human beings with one thing in common. The number of identifiable social classes is virtually infinite.… In the market economy, in the international division of labor and exchange of products, there is no inherent conflict between short and tall people, people of various weights and names, etc. All classes live in harmony through the voluntary exchange of goods and services that mutually benefits them all. Furthermore, there is no reason for an individual in a free society, or in a market economy, to act on behalf of “the interests of his class” rather than, or even as a surrogate for, his own individual interest.

Classical Economics, p. 380

Only the state can create a privileged class (or a subordinate and burdened class) by acts of intervention into the economy or society. There can be no “capitalist ruling class” on the free market.

Classical Economics, p. 382

In fact, because of (a) the harmony of interests of different groups on the free market (for example, merchants and farmers) and (b) the lack of homogeneity among the interests of members of any one social class, it is fallacious to employ such terms as “class interests” or “class conflict” in discussing the market economy. It is only in relation to state action that the interests of different men become welded into “classes,” for state action must always privilege one or more groups and discriminate against others.

Conceived in Liberty v. 1, p. 261; p. 251

… in practice, any attempt at communist society will automatically become class rule …

Economic Controversies, p. 354

… the very existence of taxation creates at least two conflicting classes: the ruling and the ruled, and the ruling class are the net tax-consumers and the ruled the net taxpayers.… The greater the extent of government operation, therefore, the greater the class conflict in the society.

Economic Controversies, p. 493

… taxation creates two conflicting classes, the taxpayers and the tax-gatherers.

Economic Controversies, p. 530

The State provides a legal, orderly, systematic channel for the predation of private property; it renders certain, secure, and relatively “peaceful” the lifeline of the parasitic caste in society.

Egalitarianism as a Revolt Against Nature, pp. 59–60

The State—the organization of the political means—constitutes, and is the source of, the “ruling class” (rather, ruling caste).

Egalitarianism as a Revolt Against Nature, p. 79

… given any level of taxation, the least that will happen will be the creation of two antagonistic social classes: the “ruling” classes who gain by and live off taxation, and the “ruled” classes who pay the taxes. In short, conflicting classes of net tax-payers and net tax-consumers.

Ethics of Liberty, pp. 176–77

… it is the State that is robbing all classes, rich and poor, black and white, worker and businessman alike; it is the State that is ripping us all off; it is the State that is the common enemy of mankind.

Libertarian Forum v. 2, p. 787

… the free market is the reverse of the caste system …

Man, Economy, and State with Power and Market, p. 641

On the market all is harmony. But as soon as intervention appears on the scene, conflict is created, for each person or group may participate in a scramble to be a net gainer rather than a net loser—to be part of the intervening team, as it were, rather than one of the victims. And the very institution of taxation ensures that some will be in the net gaining, and others in the net losing, class.

Man, Economy, and State with Power and Market, p. 881

Classes are any collection of units with a certain property in common. There is no reason for them to conflict.… On the other hand, castes are State-made groups, each with its own set of violence-established privileges and tasks. Castes necessarily conflict because some are instituted to rule over the others.

Man, Economy, and State with Power and Market, pp. 1062–63n5

… there are two groups of individuals in society: the taxpayers and the tax consumers—those who are burdened by taxes and those who benefit.

Man, Economy, and State with Power and Market, p. 1151

… all caste restrictions, all restrictions on the market, simply cripple and hinder production, and thus keep everyone at or near subsistence level.

Rothbard vs. the Philosophers, p. 126

There are no homogeneous classes on the market, only individual interests. Indeed, the alleged “classes” on the market are usually the ones in strongest competition with each other. There is no basic conflict of interest between the propertied and the nonpropertied; in the first place, they are not rigid “classes” on the free market; secondly, it is one of the great truths of economics that the nonpropertied as well as, if not even more than, the propertied benefit from the free market economy based on the defense of the rights of private property. On the free market, therefore, there are no clashing class interests.

Strictly Confidential, p. 72

… individuals are the primary reality, not the constructed “classes” …

Strictly Confidential, p. 78

CLASSICAL LIBERALISM

Classical liberalism, whether natural rights or utilitarian, whether English, French or German, was devoted to a foreign policy of peace. Its firm opposition to war and imperialism was the libertarian, minimal-government corollary in foreign affairs to its minimal-government stance at home. Opposition to big government, high taxes and interventionism abroad was the corollary of the same opposition at home.

Classical Economics, pp. 286–87

Liberalism had indeed brought to the Western world not only liberty, the prospect of peace, and the rising living standards of an industrial society, but above all, perhaps, it brought hope, a hope in ever-greater progress that lifted the mass of mankind out of its age-old sinkhole of stagnation and despair.

Egalitarianism as a Revolt Against Nature, pp. 23–24

The liberal revolution implanted indelibly in the minds of the masses—not only in the West but in the still feudally-dominated undeveloped world—the burning desire for liberty …

Egalitarianism as a Revolt Against Nature, p. 47

The libertarian creed emerged from the “classical liberal” movements of the seventeenth and eighteenth centuries in the Western world, specifically, from the English Revolution of the seventeenth century. This radical libertarian movement, even though only partially successful in its birthplace, Great Britain, was still able to usher in the Industrial Revolution, thereby freeing industry and production from the strangling restrictions of State control and urban government-supported guilds. For the classical liberal movement was, throughout the Western world, a mighty libertarian “revolution” against what we might call the Old Order—the ancien régime which had dominated its subjects for centuries.

For a New Liberty, p. 2

The object of the classical liberals was to bring about individual liberty in all of its interrelated aspects.

For a New Liberty, p. 3

… classical liberalism constituted a profound threat to the political and economic interests …

For a New Liberty, p. 10

… libertarians are squarely in the great classical liberal tradition that built the United States and bestowed on us the American heritage of individual liberty, a peaceful foreign policy, minimal government, and a free-market economy.

For a New Liberty, p. 402

Liberalism had indeed brought to the western world not only liberty, the prospect of peace, and the rising living standards of an industrial society, but above all perhaps, it brought hope, a hope in ever-greater progress that lifted the mass of mankind out of its age-old sink of stagnation and despair.

… genuine Liberalism was essentially radical and revolutionary …

Left and Right, p. 9

… the history of man, with one or two luminous exceptions, was a dark and gory record of tyranny and despotism, a record of various absolute States and monarchs crushing and exploiting their underlying populations, largely peasants, who lived a brief and brutish life at bare subsistence, devoid of hope or promise. It was a classical liberalism and radicalism that brought to the mass of people that hope and that promise, and which launched the great process of fulfillment. All that man has achieved today, in progress, in hope, in living standards, we can attribute to that revolutionary movement, to that “revolution.” This great revolution was our father; it is now our task to complete its unfinished promise.

Libertarian Forum v. 1, p. 29

… [libertarians] are, in the first place, the heirs of these “classical liberals” … we are the natural allies of the laissez-faire liberals.

Libertarian Forum v. 1, p. 471

… classical liberals have of course always believed in taxation.

Libertarian Forum v. 1, p. 475

We are the “extreme” (read consistent) heirs, not of the Conservatives, but of their ancient enemies, the Classical Liberals. Classical Liberalism, with its devotion to individual liberty and a peaceful foreign policy, found itself from the beginning at the polar opposite from Conservatism, and this polarity continues today. Then as now, Conservatism has stood for Big Government and statism across the board; for militarism and repression of civil liberties at home, and for interventionism, imperialism and a warlike foreign policy abroad; for a reverence for the State and its Leader (whether King or President or some other Führer); and for a theocratically imposed “morality” in which the State imposes a religiously conceived behavior on its subjects. Libertarianism, as the heir of classical liberalism, stands, on the contrary, for individual liberty and the absence of government intervention at home or abroad. Our reverence is for the peaceful individual and our hostility goes out to the State apparatus. We hold religion and morality to be strictly the private concerns of each individual.

Libertarian Forum v. 2, p. 656

The word “liberal” was stolen from us by the social democrats a long time ago.

Making Economic Sense, p. 497

COERCION

… every man’s proper burden of risk is to refrain from coercion unless an overt act against his person or property has been initiated against him …

Economic Controversies, p. 383

… “coercion” is the use of violence or threat of violence to compel actions of others.

Economic Controversies, p. 458

… a crucial feature of the State is that it always coercively monopolizes the exercise of coercion over a given territorial area.

Libertarian Forum v. 2, p. 1179

… coercion benefits one party only at the expense of others. Coerced exchange is a system of exploitation of man by man, in contrast to the free market, which is a system of cooperative exchanges in the exploitation of nature alone.… coercion leads only to further problems: it is inefficient and chaotic, it cripples production, and it leads to cumulative and unforeseen difficulties. Seemingly orderly, coercion is not only exploitative; it is also profoundly disorderly.

… coercion and government intervention lead inexorably to hegemony, conflict, exploitation of man by man, inefficiency, poverty, and chaos.

Man, Economy, and State with Power and Market, p. 1025

… there is no coercion at all in the free market.

Man, Economy, and State with Power and Market, p. 1347

… there are basically two types of interpersonal relations or exchanges: the free or voluntary, and the coerced or hegemonic. There is no other type of social relation. Every time a free, peaceful unit-act of exchange occurs, the market principle has been put into operation; every time a man coerces an exchange by the threat of violence, the hegemonic principle has been put to work. All the shadings of society are mixtures of these two primary elements. The more the market principle prevails in a society, therefore, the greater will be that society’s freedom and its prosperity.

Man, Economy, and State with Power and Market, p. 1366

… coercion [is] physical violence or threat thereof …

Rothbard vs. the Philosophers, p. 62

There are only two relevant ideal types of social patterns: the pattern of voluntary contractual interrelation, and that of hegemonic, coercive interaction. A can interact with B, in other words, in either of two ways: by free gift or exchange—voluntarily—or by coercion. And these are all the relevant alternatives. Now, if a society is voluntarist and contractual, this freedom will develop the personality of each and permit that great growth of living standards that makes modern civilization possible, that raises us up from the caveman. If the society is markedly coercive, not only will it stunt each individual’s development, it will plunge humankind back to primitive living standards and not permit any maintenance of civilization.

Strictly Confidential, p. 46

COMPETITION

… capitalist firms are in continual competition and rivalry with each other. They compete for raw material, for labor, for sales and customers. They compete in price and quality, and in seeking new products and new ways to get ahead of their competitors.

Classical Economics, p. 382

One of the great glories of the market is that, even when greatly hobbled, competition and new wealth can break through.

Libertarian Forum v. 1, p. 506

The free market in the world of production may be termed “free competition” or “free entry,” meaning that in a free society anyone is free to compete and produce in any field he chooses. “Free competition” is the application of liberty to the sphere of production: the freedom to buy, sell, and transform one’s property without violent interference by an external power.

We have seen above that in a regime of free competition consumers’ satisfaction will, at any time, tend to be at the maximum possible, given natural conditions. The best forecasters will tend to emerge as the dominant entrepreneurs, and if anyone sees an opportunity passed up, he is free to take advantage of his superior foresight. The regime that tends to maximize consumers’ satisfaction, therefore, is not “pure competition” or “perfect competition” or “competition without cartel action,” or anything other than one of simple economic liberty.

Man, Economy, and State with Power and Market, pp. 654–55

Under “competition,” if one firm is seen to be making great profits in a particular productive process, other firms rush in to take advantage of the anticipated opportunities, and the profits disappear.

Man, Economy, and State with Power and Market, p. 677

From the point of view of consumers’ sovereignty or individual sovereignty, there is nothing at all wrong with “cutthroat competition.”

Man, Economy, and State with Power and Market, p. 682

… there can be no such thing as “pure competition,” that hypothetical state in which the demand curve for the output of a firm is infinitely elastic.

Man, Economy, and State with Power and Market, p. 695

There is only free competition …

Man, Economy, and State with Power and Market, p. 718

The pure-competition theory, however, is an utterly fallacious one.

Man, Economy, and State with Power and Market, p. 721

“Competition” … is a process, whereby individuals and firms supply goods on the market without using force. To preserve “competition” does not mean to dictate arbitrarily that a certain number of firms of a certain size have to exist in an industry or area; it means to see to it that men are free to compete (or not) unrestrained by the use of force.

Man, Economy, and State with Power and Market, p. 1118

Where the competitive spur is weak, or especially non-existent (as in government), development will be slowed down.

Science, Technology, and Government, p. 67

CONSCIOUSNESS

… the very act of doubting consciousness must itself be performed by a consciousness.

Economic Controversies, p. 10

The fundamental axiom, then, for the study of man is the existence of individual consciousness.… Not being omniscient, a man must learn; he must ever adopt ideas and act upon them, choosing ends and the means to attain these ends. Upon this simple fundamental axiom a vast deductive edifice can be constructed … the entire structure of economic thought can be deduced from this axiom.

Economic Controversies, p. 17

… the axiom of the existence of human consciousness is demonstrated as being self-evident by the fact that the very act of denying the existence of consciousness must itself be performed by a conscious being.

Economic Controversies, pp. 69–70

CONFLICT

… I see the central conflict as not between classes, (social or economic), or between ideologies, but between Power and Liberty, State and Society.… It is only through and by state action that “class” conflict can arise.

Conceived in Liberty v. 1, p. 10; p. xvi

… there are no inherent economic conflicts in the free market … Conflict is created only between those classes that rule the state and those that are exploited by the state.

Conceived in Liberty v. 3, p. 354; p. 1118

… the very nature of government creates two unequal and inherently conflicting classes in society: those who, on net, pay the taxes (the “tax-payers”), and those who, on net, live off taxes (the “tax-consumers”).

For a New Liberty, p. 64

Society is divided into a ruling elite, which is necessarily a minority of the population, which lives off the second group—the rest of the population … the very fact of government and of taxation creates inherent conflict between two great classes: those who pay taxes, and those who live off them; the net taxpayers vs. the tax-consumers.

Irrepressible Rothbard, p. 8

… there are no inherent economic conflicts on the free market; without government intrusion, there is no reason for merchants, farmers, landlords, et al., to be at loggerheads. Conflict is only created between those classes which rule the State as against those which are exploited by the State.

Libertarian Forum v. 1, p. 522

… the thesis of an inherent conflict of interest is true whenever the State or anyone else wielding force intervenes on the market. For then the intervener gains at the expense of the subjects who lose in utility.

Man, Economy, and State with Power and Market, p. 881

… the more government intervenes and subsidizes, the more caste conflict will be created in society, for individuals and groups will benefit only at one another’s expense.

Man, Economy, and State with Power and Market, p. 942

… government enterprise creates enormous caste conflicts among the citizens …

Man, Economy, and State with Power and Market, p. 954

… there is a problem of the “public sector”; scarcities and conflicts keep appearing in government services, and in these fields alone …

Man, Economy, and State with Power and Market, p. 986

Where certain groups are specially privileged or specially disabled through the coercive power of the state, they become castes, and these castes are definitely in conflict. While on the free market, one man’s gain is another man’s gain, wherever government intervenes and establishes favored and unfavored castes, one man’s or one caste’s gain is another caste’s loss. Where government intervenes, there is inevitable “caste conflict.”

Strictly Confidential, p. 72

… central and socialistic planning, far from bringing the world into a new age of harmony, would enormously exacerbate interstate and intercountry conflicts of interest; it is precisely the free market that minimizes such conflicts, and government planning that increases them.

Strictly Confidential, p. 378

CONSCRIPTION

A final word about conscription: of all the ways in which war aggrandizes the State, this is perhaps the most flagrant and most despotic. But the most striking fact about conscription is the absurdity of the arguments put forward on its behalf. A man must be conscripted to defend his (or someone else’s?) liberty against an evil State beyond the borders. Defend his liberty? How? By being coerced into an army whose very raison d’etre is the expunging of liberty, the trampling on all the liberties of the person, the calculated and brutal dehumanization of the soldier and his transformation into an efficient engine of murder at the whim of his “commanding officer”? Can any conceivable foreign State do anything worse to him than what “his” army is now doing for his alleged benefit? Who is there, O Lord, to defend him against his “defenders”?

Egalitarianism as a Revolt Against Nature, p. 132

… no man, in an attempt to exercise his right of self-defense, may coerce anyone else into defending him.… This immediately rules out conscription for defense, for conscription enslaves a man and forces him to fight on someone else’s behalf.

Ethics of Liberty, p. 83

Libertarians, being opposed to the draft as compulsory slavery, have no difficulty in calling for total exoneration for deserting draftees.

Ethics of Liberty, p. 136

… there can be no more blatant case of involuntary servitude than our entire system of conscription.… What else is involuntary servitude if not the draft?

For a New Liberty, p. 98

In addition to demanding the end of conscription, then, the libertarian also proposes to do away with the entire concept of a term of enlistment and the practice of slavery this implies. Let the armed forces operate in ways similar to police, firemen, rangers, private guards, etc.—free of the blight and the moral crime of involuntary servitude.

For a New Liberty, p. 101

… the draft—that obnoxious system of slavery and forced murder. There is nothing anyone even remotely calling himself a libertarian can say about the draft except that it is slavery and that it must be combatted.

Libertarian Forum v. 1, p. 42

The draft itself is a supreme crime, and therefore draft evaders and deserters should be regarded not as criminals but as heroes, in precisely the same way as decent men regarded the slaves who ran away via the underground railroad.

Libertarian Forum v. 1, p. 350

… surely it is monstrous, from the point of view of liberty, to correct the horrors of the draft by extending those horrors to the female sex. No, we should rejoice that women are exempt, and strive to extend that exemption to men as well.

Libertarian Forum v. 1, p. 614

Libertarians have all favored amnesty for draft resisters …

Libertarian Forum v. 2, p. 636

… all libertarians, at whatever part of our spectrum, are united in intense opposition to the draft.

Libertarian Forum v. 2, p. 926

… if there is a draft, should women be drafted as well as men? The answer must be no for every libertarian; just because half the youth population is enslaved, is no reason for us (though it may be for egalitarians) to call for enslaving the other half.

Libertarian Forum v. 2, p. 954

… conscription has the effect of forcibly withdrawing young men from the labor market and thereby giving their competitors a monopolistic, or rather a restrictionist, wage.

Man, Economy, and State with Power and Market, p. 907

Conscription, like child labor laws, removes a part of the labor force from competition in the labor market—in this case, the removal of healthy, adult members. Coerced removal and compulsory labor in the armed forces at only nominal pay increases the wage rates of those remaining, especially in those fields most directly competitive with the jobs of the drafted men. Of course, the general productivity of the economy also decreases, offsetting the increases for at least some of the workers. But, as in other cases of monopoly grants, some of the privileged will probably gain from the governmental action. Directly, conscription is a method by which the government can commandeer labor at far less than market wage rates—the rate it would have to pay to induce the enlistment of a volunteer army.

Man, Economy, and State with Power and Market, p. 1113

CONSERVATION

Which are more important, people or trees?

Egalitarianism as a Revolt Against Nature, p. 181

… growing technology not only uses up, but also adds to, usable natural resources.

Egalitarianism as a Revolt Against Nature, p. 181

The environmentalists and conservationists totally fail to realize that the free-market economy contains within itself an automatic principle for deciding the proper degree of conservation.

Egalitarianism as a Revolt Against Nature, p. 182

… the market economy contains a marvelous built-in mechanism whereby the resource owners’ decision on present as against future production will benefit not only their own income and wealth, but also that of the mass of consumers and of the national and world economy.

… The problem is that the areas where overproduction does exist are precisely those where the built-in market mechanism has been prevented from operating by the force of government. Specifically, these are the areas where private property has not been allowed in the resource itself, but only in their daily or annual use.

Egalitarianism as a Revolt Against Nature, p. 183

Pollution and overuse of resources stem directly from the failure of government to defend private property. If property rights were to be defended adequately, we would find that here, as in other areas of our economy and society, private enterprise and modern technology would come not as a curse to mankind but as its salvation.

Egalitarianism as a Revolt Against Nature, p. 189

… technology and industrial production create resources which had never existed as effective resources.

For a New Liberty, p. 310

The free price system stimulates precisely as much or as little “conservation” of any resources as is necessary.

Libertarian Forum v. 1, p. 534

… every instance of “overuse” and destruction of a natural resource has been caused, not by private property rights in natural resources, but by government.

Making Economic Sense, p. 87

… conservation of resources is one of the major functions of the free price system. The market economy is continually being forced to choose: how much of product X or product Y, of resource X or Y, should be produced now, and how much should be “conserved” to be produced in the future? Not just of oil and gas, but of everything else: copper, iron, timber, etc.

In every area, this “conservation,” this decision on how to allocate production over time, takes place smoothly and harmoniously on the free market.

Making Economic Sense, p. 218

The entire worry about “fuel efficiency” is absurd and ill-conceived.

Making Economic Sense, p. 219

… there is no reason for the would-be preserver of a monument or of a park to complain about the way the market treats his treasured objects. In the free society, these conservationists are at perfect liberty to purchase the sites and preserve them intact. They would, in effect, be deriving consumption services from such acts of preservation.

Man, Economy, and State with Power and Market, p. 575

Anyone who uses such a resource at all, whatever the extent, “deprives” some future descendant of the use. “Conservationists,” therefore, call for lower present use of such resources in favor of greater future use.… if this argument is adopted, logically no resource subject to depletion could ever be used at all. For when the future generation comes of age, it too faces a future generation. This entire line of argument is therefore a peculiarly absurd one.

Man, Economy, and State with Power and Market, p. 1037

Conservation laws restrict the use of depleting resources and force owners to invest in the maintenance of replaceable “natural” resources. The effect of both cases is similar: the restriction of present production for the supposed benefit of future production.

Man, Economy, and State with Power and Market, p. 1122

Conservation laws are truly “pie-in-the-sky” legislation.

Man, Economy, and State with Power and Market, p. 1124

Most conservationist arguments evince almost no familiarity with economics. Many assume that entrepreneurs have no foresight and would blithely use natural resources only to find themselves some day suddenly without any property. Only the wise, providential State can foresee depletion. The absurdity of this argument is evident when we realize that the present value of the entrepreneur’s land is dependent on the expected future rents from his resources.

Man, Economy, and State with Power and Market, p. 1125

Another error made by the conservationists is to assume a technology fixed for all time. Human beings use what resources they have; and as technological knowledge grows, the types of usable resources multiply.

Man, Economy, and State with Power and Market, p. 1125

Artificial conservation will wastefully prolong resources beyond the time when they have become obsolete.

Man, Economy, and State with Power and Market, p. 1126

When the government owns the land and permits private individuals to use it freely, the result is indeed a wasteful overexploitation of the resource.

Man, Economy, and State with Power and Market, p. 1127

… the conservation movement has always enjoyed an uncritical “press,” it being almost always assumed that conservationists can only be motivated by disinterested love of nature. In fact, the conservation movement … has been an alliance of elitist groups, one part of that coalition upper-class people who wish to repress further growth and thereby preserving both their own enclaves of wealth and the natural scene around them, while others have been private real estate, timber, and other interests, such as railroads, who wish to keep potentially competing public land and natural resources off the market, thereby maintaining and raising the value of their own assets and income. A final and crucial part of the coalition are the experts and technocrats, the professional bureaucrats and managers of the natural resources.

Progressive Era, p. 209

The conservation movement, past and present, has generally been painted in sweetness and light, as disinterested nature lovers leading the “people” in war against corporate interests who wished to exploit and plunder natural resources. The actual facts were quite different. …

… conservation constituted a shift of control or ownership of natural resources from private to governmental hands in order to subsidize and cartelize private interests in that area. In the name of “scientific” management, government intervention took two forms: either subsidize research and development in natural sources or withhold resources indefinitely from use, thereby cartelizing the resource, and raising prices for private producers and increasing the capital value of resources already in private hands.

Progressive Era, pp. 252–53

… many groups concerned with business also supported the conservation crusade …

Progressive Era, p. 261

… there is a deeper consistency to all parts of the [conservation] program. In every case, land and natural resources are taken out of free, private settlement and development and converted to State regulation and control, in partnership with a relatively few privileged private interests. Where government takes resources off the market, the aim is to restrict and cartelize lands or resource industries. Where government subsidizes development, it is carefully limited to a partnership with selected private interest instead of left open to the competition of the free market. Statism—corporate statism—was the key.

Progressive Era, pp. 267–68

A fallacy committed by many groups of political philosophers is that somehow an individual living in the present is of far less importance and value than some hypothetical person living in the future.

Rothbard vs. the Philosophers, p. 58

… there need be no worries, on the free market, about excess depletion, because any resource will be preserved so that its capital value will be taken into consideration, and this will be the capitalized value of expected future returns. Nobody ravages a forest if he also owns that forest and is interested in its capital value. The key then … is that private ownership should rule in natural resources, for if the resource is unowned, then surely it will be ravaged.

Strictly Confidential, p. 259

CONSTITUTION

… any progressive or Depressive income tax law violates the constitutional clause requiring uniformity of tax and also violates the Fifth Amendment’s due-process clause. The authors recognize that the adoption of the Sixteenth Amendment by no means disposed of the constitutional issue, since this amendment did not supersede the uniformity or due-process clauses.

Economic Controversies, p. 554

… if a judicial decree of “unconstitutional” is a mighty check to government power, an implicit or explicit verdict of “constitutional” is a mighty weapon for fostering public acceptance of ever-greater government power.

Egalitarianism as a Revolt Against Nature, p. 71

If a judicial decree of “unconstitutional” is a mighty check on governmental power, so too a verdict of “constitutional” is an equally mighty weapon for fostering public acceptance of ever greater governmental power.

For a New Liberty, p. 80

… the Constitution has proved to be an instrument for ratifying the expansion of State power rather than the opposite.… any written limits that leave it to government to interpret its own powers are bound to be interpreted as sanctions for expanding and not binding those powers. In a profound sense, the idea of binding down power with the chains of a written constitution has proved to be a noble experiment that failed.… The libertarian system would meet this problem by scrapping the entire notion of creating a government—an institution with a coercive monopoly of force over a given territory—and then hoping to find ways to keep that government from expanding. The libertarian alternative is to abstain from such a monopoly government to begin with.

For a New Liberty, p. 84

… the American “checks and balances” system is largely a fraud.

For a New Liberty, p. 292

… the First Amendment was only supposed to apply to Congress, and not to the several states … some states continued to have an established church well past the establishment of the American Republic.

Irrepressible Rothbard, p. 31

In the days of the Founding Fathers, no one believed that the Supreme Court, much less the Court on any given day; always spoke the last word on the Constitution. Every public official, indeed, almost every person, had his own view of constitutionality and was willing to battle for it. No one proposed to leave such vital matters up to nine oligarchic hacks in Washington.

Irrepressible Rothbard, p. 304

… we possess, in the heritage of the U.S. Constitution, a powerful instrument to take up the cudgels of the grand old cause of denationalization and the devolution of the federal government into the states and localities. Libertarians have always, and correctly, been strong on the great libertarian Ninth Amendment to the Constitution. But it is time to realize that we must also take up the old paleoconservative cause of the Tenth Amendment, the decentralization aspect of the Bill of Rights.

Irrepressible Rothbard, p. 305

… we have to rediscover not only the forgotten individualist Ninth Amendment, but also the radically decentralist Tenth Amendment, and the legal tradition and principles from which it stemmed. Dismantling the Leviathan State, a task embraced by all libertarians, must also invoke dismantling the nationalizing, centralizing, absolute oligarchy that constitutes the Supreme Court of the United States.

Irrepressible Rothbard, p. 377

… the Ninth Amendment provides explicitly a wide-open door for judicial “activists” to affirm individual rights that government may not violate.… the letter of the Ninth Amendment is an open invitation, indeed a command, to affirm numerous individual rights which the government may not violate: and these are affirmations which only the judges can make.

Left and Right, p. 96

… the Ninth Amendment does not say that all powers not granted are reserved to the people; it says positively that there are rights which the people do retain beyond the Bill of Rights and which cannot be infringed by anyone, in short by either federal or state governments. What, then, are those rights?

To anyone who understands the terminology of the eighteenth century, it is clear in general what those rights are and what they must be: the natural rights of each individual. And these natural rights in essence mean that every individual has the inherent right to dispose of his person and his property as he sees fit, with no infringement on that right by government.

Left and Right, p. 97

… if the Constitution says anything it is that the people, and not any branch of government, is sovereign.

Libertarian Forum v. 1, p. 373

What are the checks and limits of the State? None, except for the extremely difficult course of revolution against a Power with all of the guns in its hands.

Libertarian Forum v. 1, p. 539

The American Constitution … has been a hollow shell and mockery for many decades.

Making Economic Sense, p. 111

… the same pressures of the democratic process that have led to permanent and growing deficits will also be at work on the courts that have acquired the exclusive power to interpret the Constitution. The federal courts are appointed by the executive and confirmed by the legislature, and are therefore part and parcel of the government structure.

Making Economic Sense, p. 237

… the whole point of the Constitution was to bind the central government with chains of steel, to keep it tightly and strictly limited, so as to safeguard the rights and powers of the states, local communities, and individual Americans.

In the early years of the American Republic, no political leader or statesman waited for the Supreme Court to interpret the Constitution; and the Court did not have the monopoly of interpreting the Constitution or of enforcing it. Unfortunately, in practice, the federal judiciary is not “independent” at all. …

… once we allow the Supreme Court to be the monopoly interpreter of governmental—and therefore of its own—power, eventual despotism by the federal government and its kept judiciary becomes inevitable. And that is precisely what has happened. From being the instrument of binding down and severely limiting the power of the federal Leviathan, the Supreme Court and the rest of the judiciary have twisted and totally transformed the Constitution into a “living” instrument and thereby a crucial tool of its own despotic and virtually absolute power over the lives of every American citizen.

Making Economic Sense, p. 484

An essential ingredient of a truly effective revolution is that something must be done about the tyrannical judiciary.

Making Economic Sense, p. 489

… the Constitution itself has been changed from a limiting to an aggrandizing and legitimizing instrument.

Strictly Confidential, p. 53

… the Constitution, regarded as an attempt to limit government, was one of the most noble attempts at limiting government, curbing the State, in human history … it has failed, and failed almost ignominiously.

Strictly Confidential, p. 55

CONSUMER

… the wants of consumers determine what will be produced …

Classical Economics, p. 26

The whole purpose of the production system is to lead to final consumption. All the intermediate purchases are based on the expectation of final purchase by the consumer and would not take place otherwise.

Economic Controversies, p. 278

… firms receive their income, in the final analysis, from serving consumers.

Economic Controversies, p. 451

Incomes to factors and entrepreneurs on the market, therefore, are tied inextricably to the effective satisfaction of consumer demand, a satisfaction that depends on the successful forecasting of the market conditions that will exist when and after the goods or services are produced. Income to the firm and to factors from consumers is linked inextricably to the satisfaction the consumers derive. In a deep sense, therefore, income to producers on the market reflects benefits to consumers.

Economic Controversies, p. 452

… business firms in the free market earn their keep, not from wealthy customers, but from a mass market by consumers.

For a New Liberty, p. 292

… the end of the production process—the consumers’ good—is valued because it is a direct means of satisfying man’s ends. The consumers’ good is consumed, and this act of consumption constitutes the satisfying of human wants.

Man, Economy, and State with Power and Market, p. 11

… every man desires to maximize his production of consumers’ goods per unit of time. He tries to satisfy as many of his important ends as possible, and at the earliest possible time.

Man, Economy, and State with Power and Market, p. 42

… on the unhampered “market,” it is the consumers who dictate the course of production.

Man, Economy, and State with Power and Market, p. 89

The consumers, through their buying and abstention from buying, decide how much of what will be produced, at the same time determining the incomes of all the participating factors. And every man is a consumer.

Man, Economy, and State with Power and Market, p. 514

… the value scales of the consumers determine, given the stocks of original factors, all the various results of the market economy that need to be explained: the prices of the original factors, the allocation of original factors, the incomes to original factors, the rate of time preferences and interest, the length of the production processes in use, and the amounts and types of the final products. In our changing real world, this beautiful and orderly structure of the free market economy tends to be attained through the drive of the entrepreneurs toward making profit and avoiding loss.

Man, Economy, and State with Power and Market, p. 569

… production and prices will be allocated on the free market in a way best fitted to serve the needs of the consumers.

Man, Economy, and State with Power and Market, p. 623

… to the extent that producers wish to make money, they drive toward ever more efficient servicing of the desires of the consumers—allocating resources to the most value-productive areas and away from the least value-productive.

Man, Economy, and State with Power and Market, p. 625

… in the free market economy people will tend to produce those goods most demanded by the consumers.

Man, Economy, and State with Power and Market, p. 629

Of course, consumers would prefer lower prices; they always would. In fact, the lower the price, the more they would like it. …

In their role as consumers, men would always like lower prices for their purchases; in their capacity as producers, men always like higher prices for their wares.

Man, Economy, and State with Power and Market, p. 635

In the market, the fittest are those most able to serve the consumers.

Man, Economy, and State with Power and Market, pp. 889–90

On the free market, consumers can dictate the pricing and thereby assure the best allocation of productive resources to supply their wants. In a government enterprise, this cannot be done.

Man, Economy, and State with Power and Market, p. 946

… the highest money incomes and highest profits … may be achieved only through maximum service to the consumers. This principle of maximum service to consumers and producers alike (i.e., to everybody) governs the seemingly mysterious market allocation of resources: how much to devote to one firm or another, to one area or another, to the present or the future, to one good or another, to research rather than other forms of investment.

Man, Economy, and State with Power and Market, p. 1134

Businesses, in short, are producing for a market, guided by the valuations of consumers on that market. Outside observers may criticize the ultimate valuations of consumers if they choose—although if they interfere with consumption based on these valuations, they impose a loss of utility upon the consumers—but they cannot legitimately criticize the means, the allocations of factors, by which these ends are served.

Man, Economy, and State with Power and Market, p. 1135

CONTRACT

We must not be led into the trap of holding that all contracts, whatever their nature, must be enforceable (i.e., that violence may properly be used in their enforcement).… Those contracts which do not involve implicit theft [if broken] should not be enforceable in a libertarian society.

Ethics of Liberty, p. 79

The right of property implies the right to make contracts about that property: to give it away or to exchange titles of ownership for the property of another person.… the right to contract is strictly derivable from the right of private property, and therefore that the only enforceable contracts (i.e., those backed by the sanction of legal coercion) should be those where the failure of one party to abide by the contract implies the theft of property from the other party. In short, a contract should only be enforceable when the failure to fulfill it is an implicit theft of property. But this can only be true if we hold that validly enforceable contracts only exist where title to property has already been transferred, and therefore where the failure to abide by the contract means that the other party’s property is retained by the delinquent party, without the consent of the former (implicit theft). Hence, this proper libertarian theory of enforceable contracts has been termed the “title-transfer” theory of contracts.

Ethics of Liberty, p. 133

For there can be no property in someone’s promises or expectations; these are only subjective states of mind, which do not involve transfer of title, and therefore do not involve implicit theft. They therefore should not be enforceable …

Ethics of Liberty, p. 134

The theory of contract enforcement should have had nothing to do with “compensation”; its purpose should always be to enforce property rights, and to guard against the implicit theft of breaking contracts which transfer titles to alienable property. Defense of property titles—and only such defense—is the business of enforcement agencies.

Ethics of Liberty, p. 140

A mere naked promise can confer no title, and neither can any subjective expectations of the promisee.

Ethics of Liberty, p. 142

A libertarian, natural-rights, property-rights theory must therefore reconstitute contract law on the proper title-transfer basis.

Ethics of Liberty, p. 147

… the proper, libertarian, property-rights, “title-transfer” theory of contract … declares (a) that a contract is only enforceable when it involves the transfer of a property title to another person, and (b) that a person’s will, his body, is inalienable and cannot be surrendered in an enforceable transaction.

Libertarian Forum v. 2, p. 775

Contract must be considered as an agreed-upon exchange between two persons of two goods, present or future.

Man, Economy, and State with Power and Market, p. 177

CORRUPTION

Defensive bribery, in fact, performs an important social function throughout the world. For, in many countries, business could not be transacted at all without the lubricant of bribery; in this way crippling and destructive regulations and exactions can be avoided. A “corrupt government,” then, is not necessarily a bad thing; compared to an “incorruptible government” whose officials enforce the laws with great severity, “corruption” can at least allow a partial flowering of voluntary transactions and actions in a society.

Ethics of Liberty, p. 185

… police corruption occurs in those areas where entrepreneurs supply voluntary services to consumers, but where the government has decreed that these services are illegal: narcotics, prostitution, and gambling.… the government proceeds as follows: first it outlaws a certain activity—drugs, gambling, construction, or whatever—then the governmental police sell to would-be entrepreneurs in the field the privilege of entering and continuing in business.

… what the policemen sell is not just permission to function, but what is in effect a privileged monopoly.

For a New Liberty, p. 138

The way, then, to eliminate police corruption is simple but effective: abolish the laws against voluntary business activity and against all “victimless crimes.” Not only would corruption be eliminated, but a large number of police would then be freed to operate against the real criminals, the aggressors against person and property. This, after all, is supposed to be the function of the police in the first place.

For a New Liberty, p. 139

… given the unfortunate and unjust laws prohibiting, regulating, and taxing certain activities, corruption is highly beneficial to society.… Corruption greases the wheels of trade. The solution, then, is not to deplore corruption and redouble enforcement against it, but to abolish the crippling policies and laws of government that make corruption necessary.

For a New Liberty, p. 139

Organized crime is essentially anarcho-capitalist, a productive industry struggling to govern itself; apart from attempts to monopolize and injure competitors, it is productive and non-aggressive.

Irrepressible Rothbard, p. 415

COSTS

In a free market, prices determine costs and not vice versa …

America’s Great Depression, p. 71

The cost of any individual’s choice is his subjective estimate of the value ranking of the highest value foregone from making his choice. For each individual tries, in every choice, to pursue his highest-ranking end; he forgoes or sacrifices the other, lower-ranking, ends that he could have satisfied with the resources available. His cost is his second-highest ranking end, that is, the value of the highest ranking end that he has foregone to achieve a still more highly valued goal. The cost that he incurs in this decision, then, is only ex ante; as soon as his decision is made and the choice is exercised and his resource committed, the cost disappears. It becomes an historical cost, forever bygone. And since it is impossible for any external observer to explore, at a later date, or even at the same time, the internal mental processes of the actor, it is impossible for this observer to determine, even in principle, what the cost of any decision may have been.

Economic Controversies, pp. 256–57

Costs are not only monetary. …

… Costs are purely subjective and not measurable in monetary terms.… There is no such thing as “social transaction costs” …

Economic Controversies, p. 371

… costs, like utilities, are subjective, and therefore nonmeasurable and noncomparable between persons.

Economic Controversies, p. 480

… costs are not “given” and objective but are subjective estimates by various individuals of future selling prices and other economic conditions.

Economic Controversies, p. 821

… cost is not intrinsic or given; on the contrary, it itself is determined … by the value foregone in using resources in production. This value, in turn, is determined by the subjective valuations that consumers place on those products. In brief, rather than cost in some “fundamental” sense determining value, cost at any and all times is itself determined by the subjective value, or expected value, that consumers place on the various products. So that, even if we might say that prices will equal cost of production in long-run equilibrium, there is no reason to assume that such costs determine long-run price; on the contrary, expected consumer valuation determines what the value of costs will be on the market. Cost is strictly dependent on utility, in the short and long runs, and never the other way around.

Economic Thought Before Adam Smith, p. 452

… an actor’s costs are his forgone opportunities to enjoy consumers’ goods.

Man, Economy, and State with Power and Market, p. 71

“Cost” is simply the utility of the next best alternative that must be forgone in any action, and it is therefore part and parcel of utility on the individual’s value scale.

Man, Economy, and State with Power and Market, p. 136

… past costs play no role in human action …

Man, Economy, and State with Power and Market, p. 137

… psychic cost is the next most important use that must be forgone—the use that must be sacrificed in order to attain the most important end. The highest ranked utility forgone, therefore, is defined as the cost of any action.

Man, Economy, and State with Power and Market, p. 262

… the cost, or “marginal” cost, of any decision is the next highest utility that must be forgone because of the decision.

Man, Economy, and State with Power and Market, p. 340

… costs are subjective and cannot be precisely determined by outside observers …

Man, Economy, and State with Power and Market, p. 341

Once the product has been made, “cost” has no influence on the price of the product. Past costs, being ephemeral, are irrelevant to present determination of prices. …

That costs do have an influence in production is not denied by anyone. However, the influence is not directly on the price, but on the amount that will be produced or, more specifically, on the degree to which factors will be used.

Man, Economy, and State with Power and Market, p. 342

There are no “objective” or “real” costs that determine, or are coordinate in determining, price.

Man, Economy, and State with Power and Market, p. 343

… costs do not determine prices, but vice versa. Or more accurately, prices of consumers’ goods, through market processes, determine the prices of productive factors …

Man, Economy, and State with Power and Market, p. 564

… costs are equal to prices only in equilibrium; since the economy is never in equilibrium, costs are never a precise estimate of what the free-market price would have been.

Man, Economy, and State with Power and Market, p. 923

… costs are not in fact static but flexible; they change according to prices and hence cannot be used as a guide to the setting of prices … prices equal average costs only in final equilibrium, and equilibrium cannot be regarded as an ideal for the real world. The market only tends toward this goal.

Man, Economy, and State with Power and Market, p. 950

COUNTERFEITING

Counterfeiting will have far more unfortunate consequences for the economy than simple inflation of the price level. There will be other, and permanent, distortions of the economy away from the free market pattern that responds to consumers and property-rights holders in the free economy.… In addition to its more narrowly economic distortion and unfortunate consequences, counterfeiting gravely cripples the moral and property rights foundation that lies at the base of any free-market economy.

Case Against the Fed, p. 26

Counterfeiting, therefore, is inflationary, redistributive, distorts the economic system, and amounts to stealthy and insidious robbery and expropriation of all legitimate property-owners in society.

Case Against the Fed, p. 27

Money is acquired on the market by producing goods and services, and then buying money in exchange for these goods. But there is another way to obtain money: creating money oneself, without producing—by counterfeiting. Money creation is a much less costly method than producing; therefore the state, with its ever-tightening monopoly of money creation, has a simple route that it can take to benefit its own members and its favored supporters. And it is a more enticing and less disturbing route than taxes—which might provoke open opposition. Creating money, on the contrary, confers open and evident benefits on those who create and first receive it; the losses it imposes on the rest of society remain hidden to the lay observer.

Case for a 100 Percent Gold Dollar, pp. 38–39

The creation of paper money severs the vital market link between production and income; for now nonproducers are able, so to speak, to “counterfeit,” to create their own money and to use it to bid away resources from genuine producers. Money creation, in short, redistributes income and wealth from producers to legalized counterfeiters, and to the witting or unwitting beneficiaries of this counterfeiting. Second, this redistribution is effected by subtle and silent means, and this does not raise the opposition provoked by the more direct bludgeon of, say, taxation—and—government spending. Third, the inflation (issue of notes or deposits beyond the stock of specie) weakens and ultimately wrecks the integrity of the monetary unit.

Conceived in Liberty v. 2, p. 125; p. 623

What is desperately needed is to abolish the counterfeiting.

Economic Controversies, p. 210

Counterfeiting must be prosecuted fully by the law and, more than that, must be scorned and condemned by public opinion.… One hundred percent banking must be enforced, not by administrative regulations, but by the legal system.

Economic Controversies, p. 216

There can be no genuine free market or desocialization so long as government is permitted to counterfeit money …

Economic Controversies, p. 439

… on the free market, the only way to obtain money is to produce and sell goods or services to those who wish to buy; thus, the only way to acquire money from other people is to provide them, pari passu, with services they desire. But there is one way to break the requirement of producing desired goods and services to obtain money; and that is to gain control of the means of creating money. If one can create new money simply and easily, then he can enter the market to consume goods and services without first having to produce any himself. On the free market, private individuals cannot do this, since this constitutes the crime of “counterfeiting.” … The “legalized counterfeiting” of “monetary issue” permits the State to break the production—monetary income chain to its own advantage. Necessarily, this also means to the detriment of the actual producers in society, who must yield resources to the bidding of those who come to the marketplace equipped with this newly issued money.

Economic Controversies, pp. 712–13

Just as the State arrogates to itself a monopoly power over legalized kidnapping and calls it conscription; just as it has acquired a monopoly over legalized robbery and calls it taxation; so, too, it has acquired the monopoly power to counterfeit and calls it increasing the supply of dollars …

For a New Liberty, p. 222

He who is given the power to counterfeit do so unless stopped by counter-pressure.

Libertarian Forum v. 1, p. 510

The counterfeiter, by introducing fake money into the economy, is able to steal from everyone by robbing every person of the value of his currency. By diluting the value of each ounce or dollar of genuine money, the counterfeiter’s theft is more sinister and more truly subversive than that of the highwayman; for he robs everyone in society, and the robbery is stealthy and hidden, so that the cause-and-effect relation is camouflaged.

Making Economic Sense, p. 275

… the counterfeiters and the early recipients of the new money bid away resources from the poor suckers who are down at the end of the line to receive the new money, or who never even receive it at all.

Making Economic Sense, p. 276

Counterfeiting is a method of taxation and redistribution—from producers to counterfeiters and to those early in the chain when counterfeiters spend their money and the money gets respent.

Making Economic Sense, p. 319

It is, in fact, difficult to see the economic or moral difference between the issuance of pseudo receipts and the appropriation of someone else’s property or outright embezzlement or, more directly, counterfeiting. Most present legal systems do not outlaw this practice; in fact, it is considered basic banking procedure. Yet the libertarian law of the free market would have to prohibit it.

Man, Economy, and State with Power and Market, p. 803

It should be understood that, praxeologically, there is no difference between the nature and effects of taxation and inflation on the one hand, and of robberies and counterfeiting on the other. Both intervene coercively in the market, to benefit one set of people at the expense of another set.

Man, Economy, and State with Power and Market, pp. 1149–50

Counterfeiting is of course fraud. …

… counterfeiting defrauds and injures not only the specific holders of the new coins but all holders of old dollars—meaning, everyone else in society.

Mystery of Banking, p. 49

Counterfeiting, and the resulting inflation, is therefore a process by which some people—the early holders of the new money—benefit at the expense of (i.e., they expropriate) the late receivers. The first, earliest and largest net gainers are, of course, the counterfeiters themselves.

Mystery of Banking, pp. 50–51

Counterfeiting is evidently but another name for inflation …

What Has Government Done to Our Money?, p. 50

Governmental control of money could only become absolute, and its counterfeiting unchallenged, as money substitutes came into prominence in recent centuries. The advent of paper money and bank deposits, an economic boon when backed fully by gold or silver, provided the open sesame for government’s road to power over money, and thereby over the entire economic system.

What Has Government Done to Our Money?, pp. 64–65

CREDIT

Placing your goods in a warehouse (or, alternatively, in a safe-deposit box) is not, in other words, a “debt contract”; it is known in the law as a “bailment” contract, in which the bailor (the depositor) leaves property in the care, or in the trust of, the bailee (the warehouse).

Case Against the Fed, p. 35

… credit always involves the purchase of a future good by the creditor in exchange for a present good (money). The creditor gives up a present good in exchange for an IOU for a good coming to him in the future. But a claim—and bank notes or deposits are claims to money—does not involve the creditor’s relinquishing any of the present good. On the contrary, the noteholder or deposit-holder still retains his money (the present good) because he has a claim to it, a warehouse receipt, which he can redeem at any time he desires.

Case for a 100 Percent Gold Dollar, pp. 45–46

… the essence of a loan is that a “present good” (money which can be used at present) is being exchanged for a “future good” (an IOU which can only be used at some point in the future). Since people always prefer money right now to the present prospect of getting the same amount of money some time in the future, the present good always commands a premium in the market over the future. This premium is the interest rate, and its height will vary according to the degree to which people prefer the present to the future, i.e., the degree of their time-preferences.

Economic Depressions: Their Cause and Cure, pp. 31–32

… a loan is precisely the transfer of a sum of money in exchange for the current promise of a sum of money in the future.

Economic Thought Before Adam Smith, p. 400

Would bankruptcy laws be permissible in a libertarian legal system? Clearly not, for the bankruptcy laws compel the discharge of a debtor’s voluntarily contracted debts, and thereby invade the property rights of the creditors.… Bankruptcy laws, which discharge the debt in defiance of the property rights of the creditor, virtually confer a license to steal upon the debtor.

Ethics of Liberty, pp. 143–44

In a credit transaction, a present good is exchanged for a future good.

Man, Economy, and State with Power and Market, p. 166

… the various rates of time preference—ultimately determined by relative positions on individual value scales—will act to set the price of credit exchanges. Moreover, the receiver of the present good—the debtor—will always have to repay a greater amount of the good in the future to the creditor—the man who receives the claim, since the same number of units is worth more as a present good than as a future good. The creditor is rendering the debtor the service of using a good in the present, while the debtor pays for this service by repaying a greater amount of the good in the future.

Man, Economy, and State with Power and Market, p. 167

Consumer credit that does not add to the money supply is not inflationary; it simply permits consumers to redirect the pattern of their spending so as to buy more of what they want and ascend higher in their value scales. In short, they may redirect spending from nondurable to durable goods. This is a transfer of spending power, not an inflationary rise. The device of consumer credit was a highly productive invention.

Man, Economy, and State with Power and Market, pp. 984–85

Government loans to private enterprise, therefore, or guarantees of private loans, create many centers of government ownership. Furthermore, the total quantity of savings in the economy is not increased by government guarantees and loans, but its specific form is changed. The free market tends to allocate social savings to their most profitable and productive channels. Government loans and guarantees, by contrast, divert savings from more to less productive channels. They also prevent the success of the most efficient entrepreneurs and the weeding out of the inefficient (who would then become simply labor factors rather than entrepreneurs). In both these ways, therefore, government lending lowers the general standard of living …

Man, Economy, and State with Power and Market, p. 1274

In a loan, or a credit transaction, the creditor exchanges a present good—that is, a good available for use at any time in the present—for a future good, an IOU redeemable at some date in the future. Since present goods are more valuable than future goods, the creditor will invariably charge, and the debtor pay, an interest premium for the loan.

The hallmark of a loan, then, is that the money is due at some future date and that the debtor pays the creditor interest. But the deposit, or claim transaction, is precisely the opposite. The money must be paid by the bank at any time the depositor presents the ticket, and not at some precise date in the future.

Mystery of Banking, p. 87

In a credit transaction, the possessor of money (a good useful in the present) exchanges it for an IOU payable at some future date (the IOU being a “future good”) and the interest charge reflects the higher valuation of present goods over future goods on the market. But bank notes or deposits are not credit; they are warehouse receipts, instantaneous claims to cash (e.g., gold) in the bank vaults. The debtor makes sure that he pays his debt when payment becomes due; the fractional reserve banker can never pay more than a small fraction of his outstanding liabilities.

What Has Government Done to Our Money?, pp. 46–47

CREDIT EXPANSION

… credit-expansion, launched by the banking system, causes booms and busts.

America’s Great Depression, p. xxxvii

… what happens when banks print new money (whether as bank notes or bank deposits) and lend it to business? The new money pours forth on the loan market and lowers the loan rate of interest. It looks as if the supply of saved funds for investment has increased, for the effect is the same: the supply of funds for investment apparently increases, and the interest rate is lowered. Businessmen, in short, are misled by the bank inflation into believing that the supply of saved funds is greater than it really is. Now, when saved funds increase, businessmen invest in “longer processes of production,” i.e., the capital structure is lengthened, especially in the “higher orders” most remote from the consumer. Businessmen take their newly acquired funds and bid up the prices of capital and other producers’ goods, and this stimulates a shift of investment from the “lower” (near the consumer) to the “higher” orders of production (furthest from the consumer)—from consumer goods to capital goods industries.

America’s Great Depression, pp. 10–11

Credit expansion generates the business cycle regardless of the existence of unemployed factors. Credit expansion in the midst of unemployment will create more distortions and malinvestments, delay recovery from the preceding boom, and make a more grueling recovery necessary in the future.

America’s Great Depression, p. 30

… credit expansion distorts investment by directing too much of the available capital into the higher orders of production, leaving too little for lower …

America’s Great Depression, p. 31

To generate the business cycle, inflation must take place via loans to business …

America’s Great Depression, p. 93

The more the banks issue beyond the cash in their vaults, the more outrageous the discrepancy, and the greater the possibility of a sudden loss of confidence in the banks …

Case Against the Fed, p. 50

For any one bank, the more it creates fake receipts, the more danger it will be in.

Case Against the Fed, p. 53

… bank credit expansion under fractional-reserve banking (or “creation of counterfeit warehouse receipts”) creates price inflation, loss of purchasing power of the currency unit, and redistribution of wealth and income.

Case Against the Fed, p. 54

… swift credit contraction leads to a financial and business crisis and recession … the credit-creation process by the banks habitually generates destructive boom-bust cycles.

Case Against the Fed, p. 55

… inflationary increases in bank credit take place as a process of fraudulent issue of fake warehouse receipts to standard money.

Classical Economics, p. 243

… the expansion of bank credit artificially lowers the interest rate, and lures business firms into the fatal over-investment.

Classical Economics, p. 262

… it takes bank credit expansion to distort the market’s signals to entrepreneurs and create a boom-bust cycle …

Classical Economics, p. 433

… it is precisely the expansion of bank demand deposits beyond their reserves that accounts for the phenomena of inflation and business cycles.

Economic Controversies, p. 730

… the banks, for one thing, would never be able to expand credit in concert were it not for the intervention and encouragement of government. For if banks were truly competitive, any expansion of credit by one bank would quickly pile up the debts of that bank in its competitors, and its competitors would quickly call upon the expanding bank for redemption in cash.

Economic Depressions: Their Cause and Cure, p. 26

Bank credit expansion, by pouring new loan funds into the business world, artificially lowers the rate of interest in the economy below its free market level.

Economic Depressions: Their Cause and Cure, p. 31

Bank credit expansion not only raises prices, it also artificially lowers the rate of interest, and thereby sends misleading signals to businessmen, causing them to make unsound and uneconomic investments.

For a New Liberty, p. 233

… any credit inflation sets up conditions for boom-and-bust; there is no need for prices actually to rise.

History of Money and Banking in the United States, p. 94

The expansion of credit necessarily means an increased supply in the credit market and hence a lowering of the price of credit, or the rate of interest. On the other hand, if the Fed restricts the supply of credit and the growth of the money supply, this means that the supply in the credit market declines, and this should mean a rise in interest rates.

Making Economic Sense, p. 11

Inflationary bank credit is artificial, created out of thin air; it does not reflect the underlying saving or consumption preferences of the public. Some earlier economists referred to this phenomenon as “forced” savings; more importantly, they are only temporary. As the increased money supply works its way through the system, prices and all values in money terms rise, and interest rates will then bounce back to something like their original level. Only a repeated injection of inflationary bank credit by the Fed will keep interest rates artificially low, and thereby keep the artificial and unsound economic boom going; and this is precisely the hallmark of the boom phase of the boom-bust business cycle.

Making Economic Sense, p. 35

The problem, therefore, is not debt but credit, and not all credit but bank credit financed by inflationary expansion of bank money rather than by the genuine savings of either shareholders or creditors. The problem in other words, is not debt but loans generated by fractional-reserve banking.

Making Economic Sense, p. 261

… poor quality loans and investments are always the consequence of central bank and bank-credit expansion.

Making Economic Sense, p. 293

… there could not be any monetary credit expansion on a free market.

Man, Economy, and State with Power and Market, p. 857

… there can be no bank credit expansion on the free market, since this is equivalent to the issue of fraudulent warehouse receipts.

Man, Economy, and State with Power and Market, p. 873

… credit expansion—the creation of new money-substitutes, entering the economy on the credit market.

Man, Economy, and State with Power and Market, p. 991

… bank credit expansion cannot increase capital investment by one iota. Investment can still come only from savings.

Man, Economy, and State with Power and Market, pp. 997–98

… credit expansion generates further cycles whether or not there are unemployed factors. It creates more distortions and malinvestments, delays indefinitely the process of recovery from the previous boom, and makes necessary an eventually far more grueling recovery to adjust to the new malinvestments as well as to the old.

Man, Economy, and State with Power and Market, p. 1008

… bank credit is subject to contraction as well as expansion.

Mystery of Banking, p. 101

If banks have to contract suddenly, they will put pressure on their borrowers, try to call in or will refuse to renew their loans, and the deflationary pressure will bring about a recession—the successor to the inflationary boom.

Mystery of Banking, pp. 102–03

Banks profit by credit expansion.

What Has Government Done to Our Money?, p. 74

CREDITORS AND DEBTORS

Inflation systematically injures creditors for the benefit of debtors.

Classical Economics, p. 38

Debtors always gain from the rise in prices caused by inflation; they can then pay back their loans in money of lower purchasing power than they had borrowed. Furthermore, if the new money is loaned out by government or banks, debtors may benefit from the artificially low interest rate on the loan. Creditors, conversely, are always among the groups injured by inflation, for they receive the inferior money, and interest return on further loans is artificially lowered if the new issue appears on the loan market.

Conceived in Liberty v. 2, p. 126; p. 624

It is impermissible to think in terms of fixed persisting debtor classes and creditor classes tied inextricably to certain economic occupations.

Conceived in Liberty v. 1, p. 262; p. 252

Debtor and creditor refer not to fixed occupational categories. A man is not born into the status of debtor or creditor, and anyone may shift continually from one category to the other—or to neither one.

Conceived in Liberty v. 2, p. 126; p. 624

… on the market, the creditor supplies a valuable service for which he is paid by the debtor.

Conceived in Liberty v. 2, p. 84; p. 582

The creditor is selling the debtor money, a present good (a good useful now), in exchange for an IOU for the future which is a “future good” (a good only available at some point in the future). But since everyone prefers a present good to an equivalent future good (the universal fact of time-preference), the lender will charge, and the borrower will be willing to pay, interest on a loan. Interest is, then, the price of time-preference.

Economic Thought Before Adam Smith, p. 50

The lender is never without risk; he always bears the risk of the borrower going bankrupt.

Economic Thought Before Adam Smith, p. 92

The creditor is rendering the debtor the service of using a good in the present, while the debtor pays for this service by repaying a greater amount of the good in the future.

Man, Economy, and State with Power and Market, p. 167

CRIME

Whereas an expanded market encourages increases in production and supply, theft discourages production and contracts the market.

… what distinguishes a criminal group is that its income, in contrast to that of all other organizations, is extracted by the use of violence, against the wishes or consent of the victims.

Economic Controversies, p. 457

… the activities of thieves are most emphatically not neutral to the market. In fact, the robbers divert income and resources from the market by the use of coercive violence, and thereby skew and distort production, income, and resources from what they would have been in the absence of coercion.

Economic Controversies, p. 459

… robbery clearly hobbles and restricts production. So in addition to being immoral while peaceful exchange is moral, the method of robbery hobbles production because it is parasitic upon the effort of the producers.

Economic Controversies, p. 675

In the long run, the robber destroys his own subsistence by dwindling or eliminating the source of his own supply. But not only that; even in the short-run, the predator is acting contrary to his own true nature as a man.

Egalitarianism as a Revolt Against Nature, p. 59

The gravest crimes in the State’s lexicon are almost invariably not invasions of private person or property, but dangers to its own contentment, for example, treason, desertion of a soldier to the enemy, failure to register for the draft, subversion and subversive conspiracy, assassination of rulers and such economic crimes against the State as counterfeiting its money or evasion of its income tax. Or compare the degree of zeal devoted to pursuing the man who assaults a policeman, with the attention that the State pays to the assault of an ordinary citizen.

Egalitarianism as a Revolt Against Nature, p. 81

“Crime” can then be defined and properly analyzed as a violent invasion or aggression against the just property of another individual (including his property in his own person). The positive theory of liberty then becomes an analysis of what can be considered property rights, and therefore what can be considered crimes.

Ethics of Liberty, p. xlviii

We may define anyone who aggresses against the person or other produced property of another as a criminal. A criminal is anyone who initiates violence against another man and his property …

Ethics of Liberty, p. 51

… a criminal is someone who aggresses against such property. Any criminal titles to property should be invalidated and turned over to the victim or his heirs; if no such victims can be found, and if the current possessor is not himself the criminal, then the property justly reverts to the current possessor on our basic “homesteading” principle.

Ethics of Liberty, p. 60

… “crime” is an act of aggression against a man’s property right, either in his own person or his materially owned objects. Crime is an invasion, by the use of violence, against a man’s property and therefore against his liberty.

For a New Liberty, p. 50

… it is itself criminal to invade the property of anyone not yet convicted of a crime.

For a New Liberty, p. 133

… to outlaw something which might lead to crime is an illegitimate and invasive assault on the rights of person and property …

For a New Liberty, p. 136

… we cannot call a man a criminal for stealing goods from a thief.

Libertarian Forum v. 1, p. 27

Crime is crime, and it must be put down with due and proper firmness; otherwise, appeasement of the criminal aggressor will only encourage his (or her) voraciousness for further aggression. As libertarians, and as people, we want a non-aggressive world; and to achieve this we must reinforce the general reluctance to commit crime by apprehending and punishing the criminal.

Libertarian Forum v. 1, p. 109

… “crime” means assault on person and property …

Libertarian Forum v. 1, p. 382

… if a criminal is not responsible for his actions, which are determined not by his free choice but by his environment, well then … it becomes plausible to assert that porno, miniskirts, tight jeans, etc. generate lustful impulses and the therefore the rape victim—or at least the class of sexy females in general—is responsible for the rape, rather than the rapist.

Libertarian Forum v. 2, p. 771

It is doubtful whether even a robber gains in the long run, for a society in which violence and tyranny are practiced on a large scale will so lower productivity and become so much infected with fear and hate that even the robbers may be unhappy when they compare their lot with what it might be if they engaged in production and exchange in the free market.

Man, Economy, and State with Power and Market, p. 1327

When will the American people wake up to the realization that robbery only benefits the robber, and that the edict “thou shalt not steal” applies to rulers (and Keynesians) as well as to anybody else?

Strictly Confidential, pp. 226–27