Saturday, November 12, 2011

The Revival of Austrian Economics, and the Mises Institute

By  Peter Klein

I met my first Austrians, and first libertarians, at Stanford University in the summer of 1988, at the Mises Institute's Advanced Instructional Program in Austrian Economics, which evolved into the annual Mises University. There were about 40 students, mostly PhD students in economics, with four instructors: Murray Rothbard, Hans Hoppe, Roger Garrison, and David Gordon. Lew Rockwell, Pat Barnett, and Jeff Tucker were there too.

What a week! I had never experienced anything like it. I had read some Mises and Rothbard as an undergraduate economics major, presumably comprehending very little, and had spoken by phone to Murray Rothbard, Israel Kirzner, and Mario Rizzo while considering graduate programs. But I had never really talked to anyone about Austrian economics, about free markets, about liberty and justice. Now here I was, surrounded by experts and fellow learners, listening, discussing, laughing, and arguing late into the night. The participants were smart, passionate about ideas, and eager to soak up more – even the speakers, whom I assumed knew everything already. (I remember sitting behind Rothbard at one of the other speakers' lectures and watching in amazement as he took page after page of notes in his distinctively unreadable scrawl.)

Until that conference, Austrian ideas had existed for me only in the university library (remember, there was no Internet in those days, when dinosaurs roamed the earth). Thanks to the Mises Institute, the Austrian School became to me a living, breathing entity – a social movement rather than a footnote in modern intellectual history. I felt a bit like Luke Skywalker, experiencing the Force for the first time during his light-saber training on the Millennium Falcon, when told by Obi-Wan Kenobi, "That's good. You have taken your first step into a larger world."

I went on to earn a PhD in economics and have been a university professor for the past 15 years. I enjoy university life, though I don't smoke a pipe and own but a single tweed jacket. (Of course, I still have the lifetime supply of elbow patches I received upon earning tenure.) I have published many articles in academic journals, participate in the usual professional meetings and societies, and have even won a few research awards. I have taught hundreds of undergraduate students and have had the pleasure of supervising several PhD dissertations. I am privileged to preside over a small Mises Kreis at the University of Missouri, with our own PhD seminar, an informal reading group, and more. But the highlight of every year since 1988, for me, is a Mises event, sometimes several. I've attended the summer conference – now rechristened Mises University – every year since 1988, along with dozens of other special conferences, seminars, and events, including the Rothbard Graduate Seminar the last several summers, occasional Mises Circle events, special conferences on Marx, Keynes, central banking, egalitarianism, secession, and more, and the annual Supporters' Summits in the fall. Two years ago the fall conference was in Salamanca, Spain, the birthplace of economic theory. To meet this year in Vienna, home of the Austrian School from its birth in 1871 until the 1930s, is particularly special.

The Mises Institute has been important for me personally, as well as professionally: I met my future wife at a Mises Institute conference, a 1992 meeting in Jekyll Island, Georgia, on the origins of the Federal Reserve System. Ron Paul was a featured speaker at that conference, and initially she showed more interest in Ron Paul than in me. Eventually, my strong anti-Fed views must have won her over.

By the time I entered the movement, the "Austrian revival" that started in 1974 with the South Royalton Conference and Hayek's Nobel Prize was some two decades underway, and the Austrian School was in the middle of a remarkable rebirth.[1] From its modest beginnings, in a German-speaking world dominated by the antitheory, antimarket German Historical School, the Austrian School had grown into a major intellectual force, becoming until the late 19th and early 20th centuries one of the leading economic schools of thought in Europe and the United States, only to fall into decline in the 1930s and 1940s. This story has been told expertly by others, most recently by Guido Hulsmann in his brilliant intellectual biography of Mises, and there is no need to repeat it here.[2] The point is that while the school continued to grow, intellectually, and to produce some of its greatest accomplishments later in the 20th century – Ludwig von Mises's Human Action and Rothbard's Man, Economy, and State, of course, along with other great works by Ludwig von Mises, Murray N. Rothbard, F.A. Hayek, Ludwig Lachmann, and Israel Kirzner – there wasn't an Austrian movement during this time.

The 1970s and 1980s brought an Austrian revival, however, led by Rothbard and Kirzner and coalescing into the modern Austrian movement. Central to the revival was not just ideas, but institutions – funding, organization, events, outreach, and other activities central to movement building. Lew Rockwell's establishment of the Mises Institute in 1982 was critical in this regard. First, and perhaps most important, the Mises Institute gave Rothbard an institutional home – an outlet for his writings, a platform for his lectures, a center for the intellectual camaraderie that is essential to this kind of movement, a camaraderie that I experienced firsthand at that Stanford conference in 1988, and have continued to experience in the years since.

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