Wednesday, November 7, 2012

Will John Allison Be Too Embarrassed to Head To Work Today?

David "The Destroyer" Gordon is at it again. He has torn to pieces John Allison's new book, The Financial Crisis and the Free Market Cure: Why Pure Capitalism Is the World Economy's Only Hope, in a new review. Will Allison really be able to show his face at Cato Shrugged?

Check out this biting Gordon wit:
One hesitates to challenge so learned a scholar — he reads a difficult book every month — but his knowledge of Austrian theory is not adequate to the task he has set himself. Although he mentions Mises and Hayek a few times, he never refers to anything they have to say on the business cycle. He says, e.g., "Ludwig von Mises proved the futility of central planning in his numerous books, including The Theory of Money and Credit (1913 [sic]), Socialism (1922), and Human Action (1940 [sic])." (p. 34) Very true, but in two of those books, Mises also discussed at some length the business cycle: why not address what he wrote?
I especially like Gordon's closing paragraph:
Despite the book's manifest mistakes about Austrian theory, it has attracted praise from economists, including Tyler Cowen, Peter Boettke, and Bruce Yandle. I take some comfort from the fact that none of these endorsements mentions the Austrian School.

I rush to note that Gordon also writes:
 It comes as no surprise that Allison admires this great contemporary thinker and scholar [Leonard Peikoff]. "Leonard Peikoff's book Objectivism: The Philosophy of Ayn Rand enabled me to integrate Rand's philosophy and use it as a major competitive advantage for myself and for BB&T." [p. 277]
For those not familiar with all of Gordon's writings, please keep in mind that the above comment fits in very well with Gordon's cutting sarcasm through out his review. Here is Gordon's true take on the "great contemporary thinker and scholar" Peikoff:
Leonard Peikoff's entry into the "why-Hitler?" sweepstakes comes to us with the imprimatur of the late Ayn Rand, who in her introduction hails the book [ The Ominous Parallels] as "brilliantly reasoned." Her followers regarded Miss Rand as a major philosopher, but I do not think even her most ardent devotees would claim her to have been an authority on the history of ideas. Had she been, it is difficult to see how she could have lavished praise on this misguided work. I cannot recall any other book that matches this one in its distortion of the history of philosophy...
 It should come as no surprise that, besides being radically flawed in its thesis, the book is unreliable on matters of detail. Edgar Jung, here called a Nazi, was in fact a conservative adviser to Franz von Papen and was killed by the Nazis in 1934. Ludwig Klages, although at one time a member of the George Kreis, was not a philosophical spokesman for Stefan George, with whom he quarreled. Carl Schmitt was never a communist. Kurt Gödel did not make the idiotic claim that all mathematical systems are inconsistent. Herbert Spencer did not ignore the fact that man lives by production and is able to create increasing amounts of wealth; this fact happens to lie at the basis of his social philosophy. Henry George was not a statist. Finally, what is known as the Renaissance was not, at least according to most historians, primarily an Aristotelian movement; many of its leading figures, such as Marsilio Ficino and Pico della Mirandola, were in fact supporters of one of Peikoff's bêtes noires, Plato...Those in search of an explanation for Hitler would be well advised to look elsewhere. Peikoff's book is nothing but strident and uninformed advocacy, unredeemed by humor, art, or insight. Reading it is an unrewarding task.
And I leave you with this opening paragraph of Gordon's current review:
This book contains the oddest sentence I have ever read about the current financial crisis, or for that matter about any financial crisis. John Allison, President of the Cato Institute, writes

Find out what the sentence is, it really is odd, in the full review, here.


  1. I thought it was David "the assassin" Gordon. But yeah, he delivered another headshot with that article. Its awesome.

  2. This is getting ridiculous... Was Allison trying to write a treatise on economics? No, he was writing a book for the layman. I'm sure there are many errors, but as long as the general point is made, its purpose is fulfilled.

    I understand the history between CATO and the Mises Institute, but why not take the high road? This makes the guys at Mises seem like a bunch of whiny babies when they try to pick these things apart.

    1. Seems to me like you dont understand Mises or Rothbard if you are unwilling to "pick things apart" in the name of playing nice. Both of those men would applaud Gordon's takedown.

    2. Not being particular about details when you are aware of them = compromise.

      Mises and Rothbard are the opposite of compromise.