Friday, December 31, 2010

2010 EPJ Economist of the Year

Murray Rothbard
Murray Rothbard has been named, post-humously, the 2010 EPJ Economist of the Year, specifically for his work surrounding  power elite and their influence on government.

In this day and age of the internet, it is relatively easy to track and report on the comings and goings of bankers, such as Lloyd Blankfein at Goldman Sachs and Jamie Dimon at JPMorgan, as they trek to the White House and Treasury for power influence sessions. And, it is relatively easy to see and understand how they operate and dole out cash to themselves, but anyone, who read Rothbard years ago, would have been aware and understood back then.

For example, Murray Rothbard wrote in 1984 (more than 25 years ago!), my emphasis:
Businessmen or manufacturers can either be genuine free enterprisers or statists; they can either make their way on the free market or seek special government favors and privileges. They choose according to their individual preferences and values. But bankers are inherently inclined toward statism.

Commercial bankers, engaged as they are in unsound fractional reserve credit, are, in the free market, always teetering on the edge of bankruptcy. Hence they are always reaching for government aid and bailout.

Investment bankers do much of their business underwriting government bonds, in the United States and abroad. Therefore, they have a vested interest in promoting deficits and in forcing taxpayers to redeem government debt. Both sets of bankers, then, tend to be tied in with government policy, and try to influence and control government actions in domestic and foreign affairs.
In 1992, Rothbard wrote (My emphasis):

What is less well-known is that this Big Business – Big Finance – Big Labor – Big Intellectuals and Media alliance has been going on for a long time: certainly since the New Deal. It is little known, for example, that such crucial New Deal statist "reforms" as the Social Security Act and the Wagner Act of the mid-1930s were put into place by a powerful and malevolent alliance of left-technocratic New Deal ideologues, and powerful Big Business leaders: notably John D. Rockefeller, Jr.'s Industrial Relations Counselors and its successors, and W. Averill Harriman's Business Advisory Council of the Department of Commerce...

We can rest assured that the power elite, the crucial special interest groups we have been analyzing, have no sentimental attachment to party labels. Republican? Democrat? Who cares, so long as they are under control by the "right" people. "What's good for the ______ " is the overriding consideration, and you can fill in the blank with any one of these power elite groups.
This analysis is, of course, important to help us understand what is going on now. In 2009, Lew Rockwell wrote (My emphasis):

Good for Ron [Paul] for stirring these two establishment mullahs to oppose him. But forget their official arguments, which are always a smokescreen in the state-bankster world. Remember that Greenspan was a J.P. Morgan (i.e., Rockefeller) economist before he ascended to the Fed. Now he works for hedge funds and big banks in NYC. Volcker was vice chairman of Rockefeller’s Chase Manhattan Bank before his apotheosis. Now he runs the J. Rothschild investment bank on Wall Street. Power-elite analysis is what we need. As Murray Rothbard always said, look to where high state officials come from, and where they go after their terms in office. This is criticized as conspiracy-theorizing, since men like Greenspan and Volcker are guided only by their view of the common good. Hah! Who lines their pockets, and what are their goals? That is what we always want to know for actual political science, let alone Fed analysis...
And so, as the power-elite take over more of the economy and become bolder in stuffing their own pockets with billions, it is important to understand that this is nothing new and that Murray Rothbard understood the power-elite influence on government, decades ago.

As we head into the year 2011, with Ron Paul now in charge of overseeing the beating heart of the power elite's core, as chairman of the House Subcommittee on Monetary Policy, it is important to understand what Rothbard taught, that the power elite have been influencing government for a long, long time, and they are not used to outsiders demanding an audit, poking around and understanding what they are up to. The battle that Ron Paul is taking on, when he takes on the power elite's piggy bank, the Federal Reserve, will be of epic proportions.

It is the writings of Rothbard, more than anyone else, that help us understand the power elite machinations that allowed them to take billions. And in the year ahead, it is the teachings of Rothbard that will help us understand the battle that Congressman Ron Paul has taken on.

In these particular times, there is no economist who comes close to deserving the 2010 EPJ Economist of the Year Award as much as Murray Rothbard. Rothbard's writing are significant in many, many areas, but right now, what he has taught us about the power elite, should be front and center.


  1. Paul Krugman, the elite's appointed stooge could not hold a candle to this great man and his words.
    A great choice Robert.

  2. Liberal, leftist and mainstream conservative critics have generally dismissed "ultra right" theories about capitalist elites behind socialist and communist movements as paranoid. They usually throw in claims these theories are really "closet anti-semitic", even if they find not a shred of anti-semitic comment from the 'conspiracy theorists'. This absence of evidence presumably makes the critics the real conspiracy theorists.

    Your blog shows that Rothbard was running rungs around these mainstream critics. Investment banking interests have a vested interest in deficit generating state policies whether those policies be of the welfarist or warfarist persuasion. This is no more a 'conspiracy theory' than the broadly respectable observation that there is a military-industrial complex and they favor policies that expand the defense budget.

    Just as there is a military-industrial-congressional complex, there is also a investment banking - debt and deficit congressional complex too. If these lobbyists favor 'socialism', it's not ideology, it's just business.

  3. Ummm, isn't Murray the winner of this award every year?