Richard Ebeling emails:
Dear Bob,
I participated in the March 29, 2016 “Libertarian Angle,” webinar sponsored by the Future of Freedom Foundation, with the Foundation’s president, Jacob G. Hornberger, on the topic: “The Virtues of Free Trade.”
In a presidential election year, many of the worst economic fallacies seem to rise to the surface, and this year is no different. Some candidates have come out forcefully against free trade and for forms of protectionism; others have given lip service to free trade, but insisted that it must be “fair” trade.
The focus of this week’s webinar, therefore, was the ethical and economic case for unrestricted freedom of trade. Surely, if individual liberty is valued and considered morally desirable, then one component should be the right of people to peacefully and voluntarily enter into exchanges with anyone they choose for mutual benefits, whether a potential trading partner is across the street or half way around the world.
And from a more “consequentialist” perspective, since the time of Adam Smith economists have pointed out and emphasized the material and cultural benefits from international division of labor and specialization so all may benefit from what others somewhere may be able to supply less expensively or in a better quality than making it at home.
And in addition, economists have explained the notion of “comparative advantage,” which captures the insight that even those who are generally more productive and efficient than others will still gain by focusing on what they are most better at in terms of productivity and the market value of their specialized ability, and allow those less efficient do things that free up one’s time and resources for their most highly valued use in the marketplace.
Also discussed were many of the common arguments against free trade, including the “balance of trade” fallacy, the misconception that foreign competition permanently destroys jobs in one’s own country, and the error in thinking that any benefits from international trade comes from the sale of exports rather than the importing of goods from other lands.
The webinar runs for about 30 minutes.
Best,
Richard
Showing posts with label Richard Ebeling. Show all posts
Showing posts with label Richard Ebeling. Show all posts
Wednesday, March 30, 2016
Monday, February 15, 2016
The Follies and Fallacies of Keynesian Economics
Dear Bob,
I have a new article on the “EpicTimes” news and commentary website on, “The Follies and Fallacies of Keynesian Economics.”
This February marks the 80th anniversary of the publication of John Maynard Keynes’s most famous book, “The General Theory of Employment, Interest and Money,” which appeared in London bookstores on February 4, 1936, and served as the foundation for Keynesian Economics.
Few book have so rapidly come to dominate the thinking of economists and policy-makers as Keynes’s ideas and policy prescriptions. In less than a decade after its publication all of the older insights of the pre-Keynesian economists were shoved aside for the “new economics”
Gone was the older understanding of how competitive markets worked, why a sound monetary system based on gold was desirable, and why government spending should be restrained within the requirement of balanced budgets. Also rejected was the alternative theory that if booms and busts of inflations and depressions occurred it was not because they were inherent in the capitalist system, but were set in motion as a result of monetary expansion and interest rate manipulations by central banks.
Instead, Keynes insisted that markets were unpredictably unstable for the correction of which it was necessary to have paper monies controlled at the discretion of central banks, and that governments needed to have the power and flexibility to run budget deficits whenever and to whatever extent needed to compensate for the instabilities of market capitalism that threatened mass and prolonged unemployment when left to its own devices.
Here was now the economics of perpetual budget deficits, arrogant and presumptuous monetary central planning, and dangerous growth in the size and intrusiveness of government over society wrapped in the rationale of macroeconomic stability and stabilization.
In spite of changes and developments in Macroeconomics over the last half-century, the premise and presumption remains that governments and their central banks have the knowledge and wisdom, and need the necessary economic policy tools to micro-manage the “macro-economy,” with, unfortunately, continuing disastrous effects.
http://www.epictimes.com/richardebeling/2016/02/the-follies-and-fallacies-of-keynesian-economics/
Best,
Richard
RW Note:
Richard's summary of the problems with Keynesian economics is excellent.
For those looking for a detailed page-by-page destruction of The General Theory, Henry Hazlitt's The Failure of the New Economicss is a must read.
For an understanding of Keynes on an individual level, his intellectual shifts, his membership in secret societies, etc, see: Keynes the Man by Murray Rothbard.
Friday, February 5, 2016
The Federal Reserve and Sound Money
Richard Ebeling emails:
Dear Bob,
The National Center for Policy Analysis (NCPA) has published an article of mine on “The Federal Reserve and Sound Money.”
We are living through a time of monetary chaos resulting in economic instability and sluggish economic growth due to central bank mismanagement of the money supply and interest rate manipulation.
Taking the long-view and not the zigzags of daily monetary policy by the Federal Reserve, it is time to rethink the existing government controlled paper money system. Money must be restored to the marketplace and out of the hands of the political arena of central banking.
The first step in this direction can a return to some form of a gold standard, under which the supply of money in the economy is determined by market forces of supply and demand, with market-based interest rates coordinating choices of savers with the profit-oriented decisions of investors.
The end goal should be a monetary and banking system completely free of government control and oversight, with a move to a private, competitive free banking system. But until then, a return to some form of a gold standard might significantly reduce the dangers from government monetary mischief.
http://www.ncpa.org/pdfs/ib188.pdf
Best,
Richard
Dear Bob,
The National Center for Policy Analysis (NCPA) has published an article of mine on “The Federal Reserve and Sound Money.”
We are living through a time of monetary chaos resulting in economic instability and sluggish economic growth due to central bank mismanagement of the money supply and interest rate manipulation.
Taking the long-view and not the zigzags of daily monetary policy by the Federal Reserve, it is time to rethink the existing government controlled paper money system. Money must be restored to the marketplace and out of the hands of the political arena of central banking.
The first step in this direction can a return to some form of a gold standard, under which the supply of money in the economy is determined by market forces of supply and demand, with market-based interest rates coordinating choices of savers with the profit-oriented decisions of investors.
The end goal should be a monetary and banking system completely free of government control and oversight, with a move to a private, competitive free banking system. But until then, a return to some form of a gold standard might significantly reduce the dangers from government monetary mischief.
http://www.ncpa.org/pdfs/ib188.pdf
Best,
Richard
Wednesday, February 3, 2016
Edwin Cannan: A Voice for Free Markets and Global Posperity
By Richard Ebeling
Today is British economist, Edwin Cannan’s, birthday. Born on February 3, 1861, Cannan died on April 8, 1935. A professor at the London School of Economics from 1895 to 1926, he influenced an entire generation of British economists to be critical of any unreflective advocacy of socialism, nationalism and interventionism. While not an advocate of laissez-faire, he strongly emphasized the importance and superiority of the competitive, free market, and drew attention to the power of markets to bring about a global system of peace and prosperity.
Cannan was a master of the history of economic thought. His two major works, “A History of the Theories of Production and Distribution in English Political Economy from 1776 to 1848” (1898) and “A Review of Economic Theory” (1929) have long been considered penetrating critical studies of, especially, the “classical” labor theory of value and its conclusions, from Adam Smith through John Stuart Mill.
His 1904 edition of Adam Smith’s “Wealth of Nations” has long been considered to be an outstanding version of that work for the interested and scholarly reader.
What stands out in Edwin Cannan’s writings is a simplicity and clarity in explaining the “miracle” of the market in a global encompassing division of labor that connects multitudes of people for mutual improvement and peaceful cultural gains. His style, therefore, makes his volume, “Wealth” (1914; third ed. 1928) an entertaining pleasure to read as his takes the reader through the various facets of the working and elements of the market order.
He also was an early contributor to applying the logic of marginal analysis to the theory of money, in his book on “Money” (1918; eighth edition, 1935) and in “Modern Currency and the Regulation of Its Value” (1931), and especially in his article, ‘The Application of the Theoretical Apparatus of Supply and Demand to Units of Currency’ in the “Economic Journal” (1921).
He was an insightful and often biting critic of the collectivist fads and fashions of his day. Some of his best articles on these themes are to be found in his volume, “The Economic Outlook” (1912), especially in my opinion, ‘Economics and Socialism,’ ‘The Economic Ideal and Its Application to Countries or Nations,’ and ‘The Incompatibility of Socialism and Nationalism.’ And he could be a devastatingly sarcastic reviewer, as is seen in his highly amusing book review of Georg Friedrich Knapp’s “The State Theory of Money,” in “Economica” (June 1925).
A truly superb essay in “The Economic Outlook” is his 1902 presidential address before the British Association on, ‘The Practical Utility of Economic Science.’ He demonstrates how the basic and commonsense insights of economics easily can be applied to challenge and refute many of the most absurd economic policy proposals in the context of appreciating the wondrous workings of a market order that integrates and coordinates the actions of millions of people without central direction or command.
We find the same emphasis on the power of economic ideas, but one, Cannan argues, that can get lost with an over-development and excessive reliance on narrow technical tools of economic analysis that obscure the real-world application of economic reasoning in his presidential address before the Royal Economic Society, ‘The Need for Simpler Economics,’ published in the “Economic Journal” (September 1933).
Cannan explained the essential nature of the market order and its superiority over socialism and central planning: “Modern civilization, nearly all civilization, is based on the principle of making things pleasant for those who please the market and unpleasant for those who fail to do so, and whatever defects this principle may have, it is better than none,” and all without the use of governmental force or its threat. (Preface to his 1927 collection of essays “An Economist’s Protest.”)
Finally, he was a strong and articulate defender of Say’s Law of Markets, and that if idle resources and unemployed workers widely exist in society it is not due to a deficiency in “aggregate demand,” but is due to wrong (or disequilibrium) pricing of goods and factors of production. His analysis of the problem of economy-wide unemployment may be found in his 1932 presidential address, ‘The Demand for Labor,’ before the Royal Economic Society, published in the “Economic Journal” (September 1932), and reprinted in his collection of essays, “Economic Scares” (1933) under the changed title of ‘Not Enough Work for All’ (which he proves is never the case for labor and all other factors of production when they are rightly priced in the market).
Cannan also pointed out the perverse effects from unemployment insurance in creating disincentives for the unemployed to search for new and gainful employments; and the need for flexible labor markets in terms of both wage adjustments and worker mobility to shift into employments consistent with changing market demand patterns to assure full employment. He argued all this his article, ‘The Post-War Unemployment Problem,’ in the “Economic Journal” (March 1930).
At the London School of Economics, Edwin Cannan inspired an entire generation of economists in the immediate post-World War I era, many of whom became prominent figures in the economics profession and often strong proponents of the market order. This included, Allen G. B. Fisher, W. H. Hutt, Arnold Plant, and Lionel Robbins, among others.
One of his students and later colleagues at the London School of Economics, the monetary theorist, Theodore E. Gregory, recalled Cannan the man and teacher in his recollection shortly after Cannan’s death, in his article, ‘Edwin Cannan: A Personal Impression’ in “Economica” (Nov. 1935):
“I first heard Edwin Cannan lecture in the Autumn term of 1910 . . . Cannan was then already nearly fifty . . . My main recollection, since I have lost what must have been exceedingly bad notes, is that of a small stocky man with a black beard, a habit of propping up a leg upon the large chair which stood upon the platform, a very difficult delivery and a habit of looking over our heads into a distant corner of the room, so that much of what he said was altogether missed by us, in both senses of the word . . .
“However that may be, by the end of the two years we were all – specialists and non-specialists alike – sworn disciples . . . I doubt if any teacher of the last few decades has performed a greater service than did Cannan in all the years that he was the [London] School [of Economics] in ‘debunking’ vague language and vaguer ideas by his use of the Socratic method. The question was put without the slightest arrogance of voice or manner: we felt we were being ‘put through it’ because were young and ignorant: indeed, I doubt whether any great scholar has ever shown himself more willing and eager to encourage the slightest sign of originality on the part of his students.
“But the originality had to be genuine: Cannan had throughout the whole of the twenty-five years that I knew him a contempt for displays of cleverness for its own sake, which in itself was a healthy discipline for those brought into intimate contact with him. No use trying to impress him by intellectual fireworks! There would be a pause, the black beard would shoot up at an angle, and then came the inevitable query that would bring the whole house of cards tumbling down.
“The process of getting to know Cannan was made very much easier by the fact that the discussion classes of those days were very much smaller than they are at present, so that one simply had to say something. Cannan was never afraid of silences, and the whole atmosphere was absolutely free of hero-worship – it was all very simple and informal.”
In my opinion, even 80 years after his death, many, if not almost all, of Edwin Cannan’s writings remain timely and valuable for anyone wishing to make themselves a better economist and general thinker about the nature of economics and the workings of the market order.
Richard Ebeling is the BB&T Distinguished Professor of Ethics and Free Enterprise Leadership at The Citadel in Charleston, South Carolina.
Today is British economist, Edwin Cannan’s, birthday. Born on February 3, 1861, Cannan died on April 8, 1935. A professor at the London School of Economics from 1895 to 1926, he influenced an entire generation of British economists to be critical of any unreflective advocacy of socialism, nationalism and interventionism. While not an advocate of laissez-faire, he strongly emphasized the importance and superiority of the competitive, free market, and drew attention to the power of markets to bring about a global system of peace and prosperity.
Cannan was a master of the history of economic thought. His two major works, “A History of the Theories of Production and Distribution in English Political Economy from 1776 to 1848” (1898) and “A Review of Economic Theory” (1929) have long been considered penetrating critical studies of, especially, the “classical” labor theory of value and its conclusions, from Adam Smith through John Stuart Mill.
His 1904 edition of Adam Smith’s “Wealth of Nations” has long been considered to be an outstanding version of that work for the interested and scholarly reader.
What stands out in Edwin Cannan’s writings is a simplicity and clarity in explaining the “miracle” of the market in a global encompassing division of labor that connects multitudes of people for mutual improvement and peaceful cultural gains. His style, therefore, makes his volume, “Wealth” (1914; third ed. 1928) an entertaining pleasure to read as his takes the reader through the various facets of the working and elements of the market order.
He also was an early contributor to applying the logic of marginal analysis to the theory of money, in his book on “Money” (1918; eighth edition, 1935) and in “Modern Currency and the Regulation of Its Value” (1931), and especially in his article, ‘The Application of the Theoretical Apparatus of Supply and Demand to Units of Currency’ in the “Economic Journal” (1921).
He was an insightful and often biting critic of the collectivist fads and fashions of his day. Some of his best articles on these themes are to be found in his volume, “The Economic Outlook” (1912), especially in my opinion, ‘Economics and Socialism,’ ‘The Economic Ideal and Its Application to Countries or Nations,’ and ‘The Incompatibility of Socialism and Nationalism.’ And he could be a devastatingly sarcastic reviewer, as is seen in his highly amusing book review of Georg Friedrich Knapp’s “The State Theory of Money,” in “Economica” (June 1925).
A truly superb essay in “The Economic Outlook” is his 1902 presidential address before the British Association on, ‘The Practical Utility of Economic Science.’ He demonstrates how the basic and commonsense insights of economics easily can be applied to challenge and refute many of the most absurd economic policy proposals in the context of appreciating the wondrous workings of a market order that integrates and coordinates the actions of millions of people without central direction or command.
We find the same emphasis on the power of economic ideas, but one, Cannan argues, that can get lost with an over-development and excessive reliance on narrow technical tools of economic analysis that obscure the real-world application of economic reasoning in his presidential address before the Royal Economic Society, ‘The Need for Simpler Economics,’ published in the “Economic Journal” (September 1933).
Cannan explained the essential nature of the market order and its superiority over socialism and central planning: “Modern civilization, nearly all civilization, is based on the principle of making things pleasant for those who please the market and unpleasant for those who fail to do so, and whatever defects this principle may have, it is better than none,” and all without the use of governmental force or its threat. (Preface to his 1927 collection of essays “An Economist’s Protest.”)
Finally, he was a strong and articulate defender of Say’s Law of Markets, and that if idle resources and unemployed workers widely exist in society it is not due to a deficiency in “aggregate demand,” but is due to wrong (or disequilibrium) pricing of goods and factors of production. His analysis of the problem of economy-wide unemployment may be found in his 1932 presidential address, ‘The Demand for Labor,’ before the Royal Economic Society, published in the “Economic Journal” (September 1932), and reprinted in his collection of essays, “Economic Scares” (1933) under the changed title of ‘Not Enough Work for All’ (which he proves is never the case for labor and all other factors of production when they are rightly priced in the market).
Cannan also pointed out the perverse effects from unemployment insurance in creating disincentives for the unemployed to search for new and gainful employments; and the need for flexible labor markets in terms of both wage adjustments and worker mobility to shift into employments consistent with changing market demand patterns to assure full employment. He argued all this his article, ‘The Post-War Unemployment Problem,’ in the “Economic Journal” (March 1930).
At the London School of Economics, Edwin Cannan inspired an entire generation of economists in the immediate post-World War I era, many of whom became prominent figures in the economics profession and often strong proponents of the market order. This included, Allen G. B. Fisher, W. H. Hutt, Arnold Plant, and Lionel Robbins, among others.
One of his students and later colleagues at the London School of Economics, the monetary theorist, Theodore E. Gregory, recalled Cannan the man and teacher in his recollection shortly after Cannan’s death, in his article, ‘Edwin Cannan: A Personal Impression’ in “Economica” (Nov. 1935):
“I first heard Edwin Cannan lecture in the Autumn term of 1910 . . . Cannan was then already nearly fifty . . . My main recollection, since I have lost what must have been exceedingly bad notes, is that of a small stocky man with a black beard, a habit of propping up a leg upon the large chair which stood upon the platform, a very difficult delivery and a habit of looking over our heads into a distant corner of the room, so that much of what he said was altogether missed by us, in both senses of the word . . .
“However that may be, by the end of the two years we were all – specialists and non-specialists alike – sworn disciples . . . I doubt if any teacher of the last few decades has performed a greater service than did Cannan in all the years that he was the [London] School [of Economics] in ‘debunking’ vague language and vaguer ideas by his use of the Socratic method. The question was put without the slightest arrogance of voice or manner: we felt we were being ‘put through it’ because were young and ignorant: indeed, I doubt whether any great scholar has ever shown himself more willing and eager to encourage the slightest sign of originality on the part of his students.
“But the originality had to be genuine: Cannan had throughout the whole of the twenty-five years that I knew him a contempt for displays of cleverness for its own sake, which in itself was a healthy discipline for those brought into intimate contact with him. No use trying to impress him by intellectual fireworks! There would be a pause, the black beard would shoot up at an angle, and then came the inevitable query that would bring the whole house of cards tumbling down.
“The process of getting to know Cannan was made very much easier by the fact that the discussion classes of those days were very much smaller than they are at present, so that one simply had to say something. Cannan was never afraid of silences, and the whole atmosphere was absolutely free of hero-worship – it was all very simple and informal.”
In my opinion, even 80 years after his death, many, if not almost all, of Edwin Cannan’s writings remain timely and valuable for anyone wishing to make themselves a better economist and general thinker about the nature of economics and the workings of the market order.
Richard Ebeling is the BB&T Distinguished Professor of Ethics and Free Enterprise Leadership at The Citadel in Charleston, South Carolina.
Monday, February 1, 2016
Nudging is the New Soft Tyranny
Richard Ebeling emails:
Dear Bob,
I have a new article on the “EpicTimes” news and commentary website on, “Individual Rights Must Be Preserved Without Interference from the Government.”
The fundamental issue facing society is that of the freedom of the individual versus political paternalism. Shall the individual be free to peacefully and honestly live his life as he chooses including interacting with others for mutual betterment, or shall the government presume to control and command in both great ways and small how he lives, acts and associates with others?
While “freedom” is touted on both the “left” and the “right,” in fact both “progressives” and too many political conservatives wish to use the government in various ways to make us live, act and interact with others in ways that they consider better or superior to our own choices and decisions in these matters.
The new term for such government meddling is called “nudging,” moving people in directions the intervening “experts” believe we should be pushed towards. Governments may not brutally command behavior like in the totalitarian states of the recent past. But they manipulate the trade-offs and incentives through fiscal and regulatory policy to “influence” our decisions, thus rigging the outcomes while all the time saying people are “free” to guide their own life.
This is the new “soft” tyranny that continues to threaten not just our freedom but also our failure to realize and appreciate just how controlled and manipulated we really are.
http://www.epictimes.com/richardebeling/2016/01/individual-rights-must-be-preserved-without-interference-from-the-government/
Best,
Richard
Dear Bob,
I have a new article on the “EpicTimes” news and commentary website on, “Individual Rights Must Be Preserved Without Interference from the Government.”
The fundamental issue facing society is that of the freedom of the individual versus political paternalism. Shall the individual be free to peacefully and honestly live his life as he chooses including interacting with others for mutual betterment, or shall the government presume to control and command in both great ways and small how he lives, acts and associates with others?
While “freedom” is touted on both the “left” and the “right,” in fact both “progressives” and too many political conservatives wish to use the government in various ways to make us live, act and interact with others in ways that they consider better or superior to our own choices and decisions in these matters.
The new term for such government meddling is called “nudging,” moving people in directions the intervening “experts” believe we should be pushed towards. Governments may not brutally command behavior like in the totalitarian states of the recent past. But they manipulate the trade-offs and incentives through fiscal and regulatory policy to “influence” our decisions, thus rigging the outcomes while all the time saying people are “free” to guide their own life.
This is the new “soft” tyranny that continues to threaten not just our freedom but also our failure to realize and appreciate just how controlled and manipulated we really are.
http://www.epictimes.com/richardebeling/2016/01/individual-rights-must-be-preserved-without-interference-from-the-government/
Best,
Richard
Monday, December 14, 2015
Compulsory Unions Means Less Worker Freedom
Richard Ebeling emails:
Dear Bob,
I have a new article on the “EpicTimes” news and commentary website on “‘Compulsory Unions Means Less Worker Freedom.”
The Obama Administration has attempted to push compulsory labor union power both at home and most recently abroad, under the presumption that workers when left on their own face exploitation and negotiating disadvantage when facing employers.
I argue that these compulsory labor union arguments are fundamentally flawed and inconsistent with how competitive labor markets have and do work. Furthermore, compulsory labor unions and collective bargaining, in fact, deny individual workers the most essential element of liberty: personal choice and the right of freedom of association – which also includes the right to not associate.
Also, compulsory unionism and collective bargaining operate similar to legally privileged business monopolies, only in this instance a primary negative effect is on loss of work and wages for those who lose their job or never have a chance for one when unions push wages above competitively-established levels, and some workers are priced out of the market; they are left either unemployed or forced to accept less satisfactory work opportunities.
Free markets require free, open and competitive labor markets as a complement to free, open and competitive markets in production and sale of goods and services. Market freedom is indivisible, and abridgements weaken and deny each individual’s right to free association and limit the mutual improvements in human life that are possible within the arena of competition.
http://www.epictimes.com/richardebeling/2015/12/compulsory-unions-equals-less-worker-freedom/
Best,
Richard
Dear Bob,
I have a new article on the “EpicTimes” news and commentary website on “‘Compulsory Unions Means Less Worker Freedom.”
The Obama Administration has attempted to push compulsory labor union power both at home and most recently abroad, under the presumption that workers when left on their own face exploitation and negotiating disadvantage when facing employers.
I argue that these compulsory labor union arguments are fundamentally flawed and inconsistent with how competitive labor markets have and do work. Furthermore, compulsory labor unions and collective bargaining, in fact, deny individual workers the most essential element of liberty: personal choice and the right of freedom of association – which also includes the right to not associate.
Also, compulsory unionism and collective bargaining operate similar to legally privileged business monopolies, only in this instance a primary negative effect is on loss of work and wages for those who lose their job or never have a chance for one when unions push wages above competitively-established levels, and some workers are priced out of the market; they are left either unemployed or forced to accept less satisfactory work opportunities.
Free markets require free, open and competitive labor markets as a complement to free, open and competitive markets in production and sale of goods and services. Market freedom is indivisible, and abridgements weaken and deny each individual’s right to free association and limit the mutual improvements in human life that are possible within the arena of competition.
http://www.epictimes.com/richardebeling/2015/12/compulsory-unions-equals-less-worker-freedom/
Best,
Richard
Thursday, December 3, 2015
Do Libertarians Really Hate the Poor?
Dear Bob,
I participated in the December 1, 2015 “Libertarian Angle,” webinar sponsored by the Future of Freedom Foundation, with the Foundation’s president, Jacob G. Hornberger, on the topic: “Do Libertarians Really Hate the Poor?.”
This week’s discussion revolved around the issue of how too many on “the left” confuse the free market advocate’s disagreement with the welfare state as a method for ameliorating the condition of the poor as meaning a disagreement with the end or goal of reducing or eliminating poverty.
All people of good will and benevolence desire a world in which poverty has been radically reduced or eliminated. The issue is which economic policies and social institutions are most conducive to achieving that goal.
The friend of individual liberty, free markets and constitutionally limited government advocates open competitive markets, low taxes and unregulated private enterprise precisely because they consider that the framework most likely to create the incentives and opportunities for work, savings, investment, and mutual gains from trade to improve the material and general social circumstances of all, over time.
At the same time, the friend of freedom argues that the fundamental principle is that every individual should be respected and treated with the dignity of having the right to peacefully and honestly live his own life as he chooses to give his live a meaning and a purpose that gives him fulfillment and happiness.
The advocate of the welfare state ends up being a “social engineer” who has a arrogance and a hubris that he knows better than people themselves how they should live their lives, and what their “real” and “true” needs are, and how they should be provided for.
The ultimate way to help the poor is through that system of individual rights, private property, free enterprise and limited government.
The webinar runs for about 30 minutes.
Best,
Richard
I participated in the December 1, 2015 “Libertarian Angle,” webinar sponsored by the Future of Freedom Foundation, with the Foundation’s president, Jacob G. Hornberger, on the topic: “Do Libertarians Really Hate the Poor?.”
This week’s discussion revolved around the issue of how too many on “the left” confuse the free market advocate’s disagreement with the welfare state as a method for ameliorating the condition of the poor as meaning a disagreement with the end or goal of reducing or eliminating poverty.
All people of good will and benevolence desire a world in which poverty has been radically reduced or eliminated. The issue is which economic policies and social institutions are most conducive to achieving that goal.
The friend of individual liberty, free markets and constitutionally limited government advocates open competitive markets, low taxes and unregulated private enterprise precisely because they consider that the framework most likely to create the incentives and opportunities for work, savings, investment, and mutual gains from trade to improve the material and general social circumstances of all, over time.
At the same time, the friend of freedom argues that the fundamental principle is that every individual should be respected and treated with the dignity of having the right to peacefully and honestly live his own life as he chooses to give his live a meaning and a purpose that gives him fulfillment and happiness.
The advocate of the welfare state ends up being a “social engineer” who has a arrogance and a hubris that he knows better than people themselves how they should live their lives, and what their “real” and “true” needs are, and how they should be provided for.
The ultimate way to help the poor is through that system of individual rights, private property, free enterprise and limited government.
The webinar runs for about 30 minutes.
Best,
Richard
Wednesday, December 2, 2015
Communism in the Twentieth Century Failed Wherever Tried – The Soviet Union, Communist China, etc.
Richard Ebeling emails:
Dear Bob,
I was the guest December 30, 2015, on “Power Trading Radio” hosted by John O’Donnell, on the themes of “Thanksgiving, Freedom and Prosperity.”
The “real story” of Thanksgiving was discussed as an example of the failure of collectivism and the birth of free enterprise in America. Also, discussed was the nature and workings of the free market capitalist system as the means and method to establishing and sustaining a society of both freedom and prosperity.
In this context, it was also discussed how and why communism in the twentieth century failed wherever tried – the Soviet Union, Communist China, etc. – due to the fundamental unworkability of socialist central planning, as was explained by a number of economists, in particular the Austrian economist, Ludwig von Mises.
And, finally, the relationship between a prosperous society and “sound,” reliable money not subject to arbitrary and erratic changes that threaten economic instability and inflation.
Best,
Richard
Dear Bob,
I was the guest December 30, 2015, on “Power Trading Radio” hosted by John O’Donnell, on the themes of “Thanksgiving, Freedom and Prosperity.”
The “real story” of Thanksgiving was discussed as an example of the failure of collectivism and the birth of free enterprise in America. Also, discussed was the nature and workings of the free market capitalist system as the means and method to establishing and sustaining a society of both freedom and prosperity.
In this context, it was also discussed how and why communism in the twentieth century failed wherever tried – the Soviet Union, Communist China, etc. – due to the fundamental unworkability of socialist central planning, as was explained by a number of economists, in particular the Austrian economist, Ludwig von Mises.
And, finally, the relationship between a prosperous society and “sound,” reliable money not subject to arbitrary and erratic changes that threaten economic instability and inflation.
Best,
Richard
Monday, October 19, 2015
Individualism vs. Sacrificial Collectivism
Richard Ebeling emails:
Dear Bob,
I have new article on the news and commentary website, “EpicTimes,” on, “Individualism vs. Sacrificial Collectivism.”
Free market capitalism has resulted in more freedom and prosperity than the world has ever known. It is also the most moral political-economic system being based on an ethics of individual rights and peaceful, voluntary human association.
It is for this reason that all forms of collectivism in modern times – Soviet communism, German Nazism, Islamic fundamentalism – reject philosophical, political and economic individualism.
Why? Because individualism denies that there exist societal or political or religious “collectives” independent and separate from any individuals who choose or who are compelled to be part of them, and for which they are to sacrifice their life and personal purposes.
Individualism insists on the right of the individual to live and act for himself, guided by his own values, beliefs, and purposes in peaceful and non-compulsory association with others in society.
The death and destruction that has accompanied Soviet socialism, Nazi racism, and now Islamic extremism can all be seen to originate from and depend upon the misplaced idea that social, racial and religious collectives are “real” and individuals have no existence other than to serve and sacrifice for them, as the demagogic ideologues claiming to speak for these competing collectivisms insist.
This is why the defense of individualism is so important. It the only political-philosophic bulwark upon which a successful defense of liberty can be made and sustained.
http://www.epictimes.com/richardebeling/2015/10/individualism-vs-sacrificial-collectivism/
Best,
Richard
Dear Bob,
I have new article on the news and commentary website, “EpicTimes,” on, “Individualism vs. Sacrificial Collectivism.”
Free market capitalism has resulted in more freedom and prosperity than the world has ever known. It is also the most moral political-economic system being based on an ethics of individual rights and peaceful, voluntary human association.
It is for this reason that all forms of collectivism in modern times – Soviet communism, German Nazism, Islamic fundamentalism – reject philosophical, political and economic individualism.
Why? Because individualism denies that there exist societal or political or religious “collectives” independent and separate from any individuals who choose or who are compelled to be part of them, and for which they are to sacrifice their life and personal purposes.
Individualism insists on the right of the individual to live and act for himself, guided by his own values, beliefs, and purposes in peaceful and non-compulsory association with others in society.
The death and destruction that has accompanied Soviet socialism, Nazi racism, and now Islamic extremism can all be seen to originate from and depend upon the misplaced idea that social, racial and religious collectives are “real” and individuals have no existence other than to serve and sacrifice for them, as the demagogic ideologues claiming to speak for these competing collectivisms insist.
This is why the defense of individualism is so important. It the only political-philosophic bulwark upon which a successful defense of liberty can be made and sustained.
http://www.epictimes.com/richardebeling/2015/10/individualism-vs-sacrificial-collectivism/
Best,
Richard
Monday, June 22, 2015
F. A. Hayek and Why Government Can't Manage Society, Part I
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on, F. A. Hayek and Why Government Can’t Manage Society, Part I.”
Seventy years ago, Austrian economist, F. A. Hayek, published one of the important articles of the twentieth century, “The Use of Knowledge in Society.”
When the Second World War ended in 1945, the future of the world seemed to be moving the direction of socialist planned economies. Some socialists wanted Soviet-style dictatorship, while others believed in “democratic” socialism. But they all wanted the end to capitalism and the establishment of government-directed economic affairs.
In 1944, Hayek had published The Road to Serfdom, arguing that comprehensive government planning threatened to bring with it the end of the free society. “The Use of Knowledge in Society” demonstrated that the planners, even if benevolent and well-intentioned, could never have the necessary knowledge and ability to successfully plan a society due to the fact that the necessary knowledge is dispersed and decentralized among all the minds of all the people in the world.
Either people are at liberty to use their knowledge as they best see fit, or knowledge crucial to the well being of all may go unused. The key to the effective use and coordination of all that dispersed and centralized knowledge is the market price system through which people are able to inform each other about their desires as consumers and abilities as producers.
But for the price system to exist and function, there must be private property, market competition and individual freedom. Now, seventy years later, it is easier to see and appreciate the importance of Hayek’s argument. It explains why full and comprehensive socialist central planning was inevitably going to fail, as it did.
However, is Hayek’s argument against social central planning still valid and relevant in the post-Soviet world of government intervention and the welfare state? That is the next question to answer.
http://www.epictimes.com/richardebeling/2015/06/f-a-hayek-and-why-government-cant-manage-society-part-i/
Best,
Richard
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on, F. A. Hayek and Why Government Can’t Manage Society, Part I.”
Seventy years ago, Austrian economist, F. A. Hayek, published one of the important articles of the twentieth century, “The Use of Knowledge in Society.”
When the Second World War ended in 1945, the future of the world seemed to be moving the direction of socialist planned economies. Some socialists wanted Soviet-style dictatorship, while others believed in “democratic” socialism. But they all wanted the end to capitalism and the establishment of government-directed economic affairs.
In 1944, Hayek had published The Road to Serfdom, arguing that comprehensive government planning threatened to bring with it the end of the free society. “The Use of Knowledge in Society” demonstrated that the planners, even if benevolent and well-intentioned, could never have the necessary knowledge and ability to successfully plan a society due to the fact that the necessary knowledge is dispersed and decentralized among all the minds of all the people in the world.
Either people are at liberty to use their knowledge as they best see fit, or knowledge crucial to the well being of all may go unused. The key to the effective use and coordination of all that dispersed and centralized knowledge is the market price system through which people are able to inform each other about their desires as consumers and abilities as producers.
But for the price system to exist and function, there must be private property, market competition and individual freedom. Now, seventy years later, it is easier to see and appreciate the importance of Hayek’s argument. It explains why full and comprehensive socialist central planning was inevitably going to fail, as it did.
However, is Hayek’s argument against social central planning still valid and relevant in the post-Soviet world of government intervention and the welfare state? That is the next question to answer.
http://www.epictimes.com/richardebeling/2015/06/f-a-hayek-and-why-government-cant-manage-society-part-i/
Best,
Richard
Monday, May 18, 2015
Why Government Deficits and Debt do Matter
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on, “Why Government Deficits and Debt Do Matter.”
The trillion-dollar-a-year Federal government budget deficits have subsided – for now. But according to the Congressional Budget Office, in a few years those budget deficits will begin rising once more, and again be over one trillion dollars in the year 2025.
Some free market economists like Milton Friedman have argued that it is total government spending that is the real cost and burden on the citizenry and taxpayers, not whether it is funded via taxes or deficit spending.
But the Keynesian-influenced demise of an earlier balance budget rule and practice has created a political environment that other free market economists like James M. Buchanan have called “Democracy in Deficit.”
Able to rationalize deficit spending on almost anything, politicians can create the illusion that voters can get something for nothing – government spending on desired programs and activities without having to specify where the funding will come from and who will pay it – “benefits” apparently without the full “costs” for providing them.
This makes deficit spending an institutional mechanism for continuous growth in the scope and size of government.
In addition, Buchanan pointed out the moral dimension of deficit spending and the resulting accumulated debt. What is the ethics of a system under which the current generation of voters can get some of what they want from government, but pass on part or even all of the costs of their special interesting programs on to future generations on whom the taxes will fall to pay back in the future what has been borrowed yesterday and today?
This makes a balanced budget rule – including as an amendment to the Constitution—a desirable policy goal. Also important is for Congress not to cede its authority on raising the debt limit. If a future Congress were to say “No” to such a debt ceiling increase, it would automatically impose a balanced budget rule on the government.
Best,
Richard
Wednesday, April 1, 2015
Assessing Austrian Economist Eugen Böhm-Bawerk’s Contributions
Richard Ebeling emails:
Dear Bob,This month “Liberty Matters,” the discussion forum for “matters pertaining to liberty,” that is part of the “Online Library of Liberty” run by Liberty Fund of Indianapolis, is featuring my essay, “Assessing Böhm-Bawerk’s Contribution to Economics After a Hundred Years.”I explain the life, ideas and economic contributions of the leading, early Austrian economist, Eugen von Böhm-Bawerk. Famous for his development of the “Austrian” theory of capital and interest, he also was one of the leading critics of Karl Marx and his theory of capitalist exploitation of workers.He also restated, refined and improved the theory of marginal utility and price formation first formulated by Carl Menger, the founder of the Austrian School. In this context, he was a critic of interventionist policies interfering with market-based prices and wagesLess well known is that he also several times served as the finance minister of the old Austro-Hungarian Empire under the Hapsburg emperor, Franz Joseph. Especially during his four-year stint as finance minister from 1900-1904, he followed a strict fiscal policy of limited taxation and restrained government spending, while defending the gold standard and resisting attempts to introduce Keynesian-type public works “stimulus” projects.The format of the “Liberty Matters” series is that after the posting of my “lead essay” summarizing and discussing Böhm-Bawerk’s life and work on April 1, a week later there will be posted “response essays” by Dr. Roger Garrison (Auburn University); Dr. Peter Lewin (University of Texas at Dallas) and Dr. Joseph Salerno (Lubin School of Business, Pace University).After which I will have the opportunity to respond to their commentaries, and then an open discussion will follow among the participants.Eugen von Böhm-Bawerk was one of the great economists of the late 19th and early 20th centuries, and one of the fountainheads of modern Austrian Economics. Anyone interested in the “Austrian” tradition, and its insights for understanding the free market competitive process, will find, I think, this month’s “Liberty Matters” discussion valuable and worth following.Best,Richard
Monday, March 16, 2015
Business Ethics and Moral Market Conduct
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on, “Business Ethics and Moral Market Conduct.”
Surveys suggest that both political institutions and business establishments are held in low esteem by the public. While the power lusting and corruption of politics make this understandable, the low estimation of business and businessmen is another matter.
In a free market there are few more worthy ways of earning a living than as the business enterpriser, who earns his profits and tries to avoid losses by serving the wants of consumers through making new, better and less expensive goods in an arena of peaceful mutual agreement and voluntary association.
What makes many in the wider society suspicious of too many business enterprises is that fact of how often in our modern society, businessmen turn to the government for favors, privileges and special interest benefits at the expense of consumers, taxpayers and other competitors not possessing their political “pull.”
All businessmen should learn to see the benefit to themselves as well as to other others in society if they were to forswear any use of political means to attain their revenue-pursuing ends.
A morality of a respect for individual rights, private property, and voluntary exchange must be the hallmark of a real “business ethics.”
Why? Because once you are “in bed” with those possessing political power and ideological motives in the direction of more state control, then the favors and privileges you gain today may be taken away tomorrow once the government has a power grip over all that happens in the market arena of trade, commerce and industry.
http://www.epictimes.com/richardebeling/2015/03/business-ethics-and-moral-market-conduct/
Best,
Richard
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on, “Business Ethics and Moral Market Conduct.”
Surveys suggest that both political institutions and business establishments are held in low esteem by the public. While the power lusting and corruption of politics make this understandable, the low estimation of business and businessmen is another matter.
In a free market there are few more worthy ways of earning a living than as the business enterpriser, who earns his profits and tries to avoid losses by serving the wants of consumers through making new, better and less expensive goods in an arena of peaceful mutual agreement and voluntary association.
What makes many in the wider society suspicious of too many business enterprises is that fact of how often in our modern society, businessmen turn to the government for favors, privileges and special interest benefits at the expense of consumers, taxpayers and other competitors not possessing their political “pull.”
All businessmen should learn to see the benefit to themselves as well as to other others in society if they were to forswear any use of political means to attain their revenue-pursuing ends.
A morality of a respect for individual rights, private property, and voluntary exchange must be the hallmark of a real “business ethics.”
Why? Because once you are “in bed” with those possessing political power and ideological motives in the direction of more state control, then the favors and privileges you gain today may be taken away tomorrow once the government has a power grip over all that happens in the market arena of trade, commerce and industry.
http://www.epictimes.com/richardebeling/2015/03/business-ethics-and-moral-market-conduct/
Best,
Richard
Sunday, February 15, 2015
Ebeling Interview on Austrian Economics,Keynesianism, and Deflation and Inflation
Richard Ebeling emails:
Dear Bob,
I was interviewed on the radio show, "Money Market Exchange" on the topics of Austrian Economics vs. Socialism and Keynesianism, the False Fears of Deflation and the Dangers from Inflation.
The interview starts about about 6 minutes into the show and runs for 30 minutes. A transcript of the questions and my answers are on the webpage, also.
https://www.moneymetals.com/podcasts/2015/02/13/eurozones-paper-money-unraveling-amid-negative-interest-rates-000668
Best,
Richard
Dear Bob,
I was interviewed on the radio show, "Money Market Exchange" on the topics of Austrian Economics vs. Socialism and Keynesianism, the False Fears of Deflation and the Dangers from Inflation.
The interview starts about about 6 minutes into the show and runs for 30 minutes. A transcript of the questions and my answers are on the webpage, also.
https://www.moneymetals.com/podcasts/2015/02/13/eurozones-paper-money-unraveling-amid-negative-interest-rates-000668
Best,
Richard
Saturday, February 14, 2015
"Introductions" to the "Selected Writings of Ludwig von Mises"
Richard Ebeling emails:
Dear Bob,
Liberty Fund has posted online as one continuous readable text the three introductions I prepared for the three volumes of the "Selected Writings of Ludwig von Mises," primarily based on the "lost papers" of Ludwig von Mises that my wife, Anna, and I discovered in a formerly secret KGB archive in Moscow, Russia.
Combined, I believe that these three introductions offer a readable and fairly comprehensive overview of the life, writings, and historical context of Mises' theoretical writings and practical activities as the economic policy analyst he worked as at the Vienna Chamber of Commerce in the years before and between the two World Wars.
As I suggest in the forward to volume 1, if you ever wondered, "But how do you apply Austrian Economics to the 'real world,'?" here is the answer. Here is Ludwig von Mises -- the leading Austrian Economist of the 20th century -- applying his ideas to the monetary, fiscal, and interventionist problems that confronted Austria-Hungary before and during the First World War and then in the new Republic of Austria in the 1920s and 1930s, between the two World Wars; and Mises' detailed practical suggestions for restoring freedom, peace, and prosperity in Europe following the end of the Second World War.
http://oll.libertyfund.org/pages/ebeling-introductions
Best,
Richard
Monday, December 22, 2014
"Yes, Virginia, There is No Political Santa Claus"
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, "EpicTimes," on "Yes, Virginia, There is No Political Santa Claus."
At the time of Christmas cheer, it is worth remembering that not only does the Santa at the North Pole not exist, neither does the political Santa that too many people believe can bring, all year along, a sleigh full of "goodies" of welfare state wealth at no cost to any one else in the society.
The political Santa has nothing to give to those it deems the "good" and "deserving" citizens that it does not first take away from the "bad" citizen-children that he declares already has "too much" or ethically should not have..
But the worst feature of political Santa and his ideological justifiers and apologists is that it reduces part of the population to permanent dependent citizen-children to be taken care of by the governmental "father," while manipulating another part of the population into believing that they owe everything to "society" -- the collective" and have no right to anything that the collective chooses not to leave to them.
The myth of a political Santa is far worse that the North Pole Santa because he undermines the spirit of individualism and liberty, and replaces it with the tribalism of political power and control.
http://www.epictimes.com/richardebeling/2014/12/yes-virginia-there-is-no-political-santa-claus/
All best wishes,
Richard
Saturday, December 20, 2014
Why Federal Reserve Interest Rate Policy is a Form of Monetary Socialism
Richard Ebeling emails:
Dear Bob,
In this radio interview on "The Jerry Doyle" show on December 18, 2014, I explain why Federal Reserve interest rate policy is a form of "monetary socialism," in that manipulating interest rates down to near zero has basically undermined the existence of a functioning banking market.
Interest rates are the intertemporal prices that coordinate the choices of income earners to save with the investment decisions of entrepreneurs and enterprises to borrow. Interest rates are supposed to keep savings and investment in proper balance, and to determine which investments, with what time horizon, are market-based profitable.
By, basically, abolishing much of the price mechanism of an essential element of the financial markets, the Federal Reserve has introduced a high degree of economic irrationality into savings and investment decision-making.
We should not be surprised if the Federal Reserve's monetary central planning has led to a new round of misdirection of resources and labor, and mal-investment of capital that will result in a future economic downturn, when these mis-matches will have to be corrected and rebalanced.
http://www.epictimes.com/richardebeling/2014/12/the-federal-reserve-plays-not-so-secret-santa-for-wall-street/
Best,
Richard
Monday, December 15, 2014
The False Promises of Two Percent Price Inflation
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, "EpicTimes," on "The False Promises of Two Percent Price Inflation."
Central Banks around the world have found a new panacea to all the economic problems of the world: a target two percent annual price inflation brought about by activist monetary policy.
Separate from the illusion that simply manipulating a rise in prices will "cure" an "ailing" economy," the entire mind set of the monetary central bankers is dominated by the Keynesian focus on macro-aggregates of total output and employment, and aggregate demand and aggregate supply.
The fallacy here is that such statistical aggregates and averages do not exist they are creations of the economist and the statistician. The real economy is made up of all individual supplies and demands and their interrelated relatives prices and wages.
The Austrian economists have effectively shown that by distortion the micro-economic relationships between all the individual demands and supplies and individual prices and wages through money and credit expansionary policy, governments and central banks cause the unemployment and economic instability they claim want to reduce.
The only real solution in an end to government and central bank control over the monetary and banking systems.
http://www.epictimes.com/richardebeling/2014/12/the-false-promises-of-two-percent-price-inflation/
Best,
Richard
Dear Bob,
I have a new article on the news and commentary website, "EpicTimes," on "The False Promises of Two Percent Price Inflation."
Central Banks around the world have found a new panacea to all the economic problems of the world: a target two percent annual price inflation brought about by activist monetary policy.
Separate from the illusion that simply manipulating a rise in prices will "cure" an "ailing" economy," the entire mind set of the monetary central bankers is dominated by the Keynesian focus on macro-aggregates of total output and employment, and aggregate demand and aggregate supply.
The fallacy here is that such statistical aggregates and averages do not exist they are creations of the economist and the statistician. The real economy is made up of all individual supplies and demands and their interrelated relatives prices and wages.
The Austrian economists have effectively shown that by distortion the micro-economic relationships between all the individual demands and supplies and individual prices and wages through money and credit expansionary policy, governments and central banks cause the unemployment and economic instability they claim want to reduce.
The only real solution in an end to government and central bank control over the monetary and banking systems.
http://www.epictimes.com/richardebeling/2014/12/the-false-promises-of-two-percent-price-inflation/
Best,
Richard
Monday, December 8, 2014
The Case for Monetary Freedom and Free Banking
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on “The Case for Monetary Freedom and Free Banking.”
Throughout history governments have been used to abuse and plunder those on under the control of political power. One of the most dangerous and disruptive forms of such plunder through the centuries has been government control and manipulation of money and banking systems.
The gold standard was a serious attempt to rein in this abuse in the heyday of free market classical liberalism of the 19th century. But it was destroyed in the madhouse inflationary policies during and following the First World War. The rise of Keynesian Economics and the modern interventionist-welfare state has created a world of unrestrained paper monies.
The only solution is the separation of money and banking from the controlling, monopoly hands of governments and their central banks. The ideal of a reborn political philosophy and policy of liberty must include monetary freedom, under which free market participants decide what shall be selected as a useful and effective medium of exchange – a free market money.
Accompanying this must be a system of private, competitive free banking, liberated from the mismanagement and abuse of those in political power and the special interests often served with the turning of the handle of the monetary printing press.
If accomplished, the 21st century can be an epoch of liberty, prosperity, and stable monetary order.
http://www.epictimes.com/richardebeling/2014/12/the-case-for-monetary-freedom-and-free-banking/
Bests,
Richard
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on “The Case for Monetary Freedom and Free Banking.”
Throughout history governments have been used to abuse and plunder those on under the control of political power. One of the most dangerous and disruptive forms of such plunder through the centuries has been government control and manipulation of money and banking systems.
The gold standard was a serious attempt to rein in this abuse in the heyday of free market classical liberalism of the 19th century. But it was destroyed in the madhouse inflationary policies during and following the First World War. The rise of Keynesian Economics and the modern interventionist-welfare state has created a world of unrestrained paper monies.
The only solution is the separation of money and banking from the controlling, monopoly hands of governments and their central banks. The ideal of a reborn political philosophy and policy of liberty must include monetary freedom, under which free market participants decide what shall be selected as a useful and effective medium of exchange – a free market money.
Accompanying this must be a system of private, competitive free banking, liberated from the mismanagement and abuse of those in political power and the special interests often served with the turning of the handle of the monetary printing press.
If accomplished, the 21st century can be an epoch of liberty, prosperity, and stable monetary order.
http://www.epictimes.com/richardebeling/2014/12/the-case-for-monetary-freedom-and-free-banking/
Bests,
Richard
Monday, December 1, 2014
Hayek's Warning: The Social Engineer's Pretense of Knowledge"
Richard Ebeling emails:
Dear Bob,
I have a new article on the news and commentary website, “EpicTimes,” on, “Hayek’s Warning: The Social Engineer’s Pretense of Knowledge.”
December 11, 2014 marks the 40th anniversary of Friedrich A. Hayek receiving the Nobel Prize in Economics at the formal award ceremony in Stockholm, Sweden, during which Hayek delivered his official Nobel lecture on, “The Pretense of Knowledge.”
Hayek warned of the danger from those in the intellectual and government policy decision-making community who arrogantly believe that they have the ability and wisdom to redesign or regulate the complex market order.
He emphasized the hubris on the part of those who fail to understand and appreciate that in the developed market system there is more knowledge and different types of knowledge that are dispersed and decentralized in the respective minds of all the participants of the society than any government master minds could ever successfully integrate or coordinate better than is done through the competitive market price system.
He particularly singled our the presumption of knowledge by the Keynesian Economists who assumed that the construction and manipulation of a series of quantitative macroeconomic statistical aggregates could serve as the policy means for managing total output and total employment, and the general wage and price levels in the economy.
What is generated by such policies, Hayek argued, are unsustainable “booms,” followed by an inescapable economic downturn, with those falsely drawn into employments during an inflation now having to adjust and rebalance their activities to be consistent with a post-inflationary environment.
More generally, Hayek warned of those social engineers who refuse to accept the humility of how little they know to plan or micro-manage a society, but by pursuing their coercive political plans threaten the long-run survivability of a free society.
This is a message that is as true and relevant today as when Hayek delivered these warnings four decades ago at the Nobel Prize ceremony.
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