Friday, December 18, 2015

Gerry, Gerry, Why Did You Go Over to the Dark Side?

Recently, I pointed out Cato's failure in taking a principled libertarian/free market approach to the guaranteed basic income plan.

Cato's failures now continue. This time reaching the op-ed page of the Wall Street Journal with a piece written by Cato fellow Gerald O'Driscoll.

In yesterday's EPJ Daily Alert, when discussing a technical issue with regard to Federal Reserve open market operations, I wrote:
In today's Wall Street Journal there is an op-ed by Gerald O’Driscoll, a senior fellow at the Cato Institute and a former vice president at the Federal Reserve Bank of Dallas. Later today at EPJ, I am going to take him to task for not being Austrian enough in his critique of Fed policy in his op-ed. But he does provide insight into how delicate the technical operations currently are at the Fed in implementing policy... 

It should be made clear that O'Driscoll knows full well Austrian school objections to the Federal Reserve and central bank money manipulations in general. He was a hardocre student of Austrian economics.

Here. for example, are pictures taken by O'Drsicoll in 1977 at a  conference held at Mills College in Oakland, CA, where the lecturers included, Murray Rothbard Friedrich Hayek and Israel Kirzner. all great Austrian economists who understood the problems with a central bank manipulating money supply.

Murray Rothbard
F. A. Hayek

Here's O'Driscoll talking to Israel Kirzner at the event:

Chuck Baird, Israel Kirzner, Gerald O'Driscoll
But. since those glorious days, O'Driscoll has wandered. like the Cato Institute, from free market, Austrian School roots. I was not the only one, however, who noticed the O'Driscoll op-ed. Walter Block did also and there isn't much I can add to his comment. So I will let Dr. Block's plea to O'Driscoll stand as the final comment on this topic:
Gerry O’Driscoll, please come home
Tom, David and Bob, speaking of Cato, in the Wall Street Journal of Thursday, December 17, 2015 (p. A19), its senior fellow, one Gerald P. O’Driscoll Jr. writes about “The Fed’s Uncertain Leap Forward.” Does he mention ending the Fed? He does not. Does he discuss the Austrian Business Cycle Theory? To ask this is to answer it. Does he in any way indicate he is a libertarian? Of course not. Does the dread name “Ron Paul” figure into his thoughts in any manner shape or form, and the long and valiant battle Dr. No has had with the fed? You’ve got to be kidding. Can one discern from reading his essay that he was once upon a time one of Murray Rothbard’s chief intellectual heirs, followers, disciples? Don’t make me laugh. Instead, he waxes eloquent about the Federal Open Market Committee’s rationale for its decisions; about labor market condition indicators; about Milton Friedman being a notable researcher in the undermining of the Phillips curve theory; about the timing of the fed’s move; about whether or not the increase in the interest rate will soon be repeated. Gerry, Gerry, you were a member in good standing of Murray’s living room crowd. You, along with Roger Garrison and Joe Salerno, were seen by Murray for a time as the leaders of the next generation of Austrian macro-money economists. What, in the name of all that which is holy, happened to you? Why did you go over to the dark side? But, it is not too late. It never is. Where there is life there is still hope. I, the Reverend Doc Block, call upon you to repent, and once again take on the mantle of Menger, Mises and Rothbard. Give up your evil mainstream ways. Cast them off, say I.

1 comment:

  1. I did a brief google search and have found scant evidence that O’Driscoll has gone to the “dark side” or has “wandered” from free market, Austrian positions. And there is no evidence of such in his WSJ op-ed, if one takes into account of the publisher and its current editorial position. Really now, a reference to Friedman (with whom the readers would be familiar) and the term “monetary rule” do not constitute serious evidence of apostasy.
    In the last view years he has continued to challenge the wisdom of central banking, supported a commodity monetary standard, and has nowhere that I have found taken back his denigration of the "New Recardians" constituting the Chicago School.
    and more recently: I could say more but at least recall Gerry's takedown of Lachman and Chicagoites in the first link and the statement of Hayek in the foreword of Economics as a Coordination Problem:

    Hayek wrote: "Professor O'Driscoll has almost persuaded me that I ought to have continued with the work I had been doing in the 1930s and 1940s rather than let myself be drawn away to other problems which I felt to be more important. I cannot now really regret it, however, when I see that not only he but also a few others are pushing beyond the point where my own impetus had flagged; in fact their efforts are doing more to make me think again about those problems than I would otherwise have done."

    I see nothing in the written record to contradict that assessment.