A milestone in the world of libertarian literature has just been passed. This event was the publication of a collection of essays, a Festschriftin tribute to Ludwig von Mises. Some of the world’s most renowned economists and leading liberal thinkers contributed to this volume, edited by Mary Sennholz. Libertarians should be cheered that there are in the world many serious men—scientists and philosophers—who advocate the free market and who warn against the threat to liberty in all government intervention.
* New York: D. Van Nostrand. xiv:333 pp. $3.50. Copies also are available through the Foundation for Economic Education, Irvington-on-Hudson, N. Y.
This book commemorates the fiftieth anniversary of the date on which Ludwig von Mises received his doctorate at the University of Vienna. The years since then have been busy ones for him. He has gained a world-wide reputation as an uncompromising advocate of the free market. He has lectured in at least ten different countries and written numerous books and articles, which have been translated into many languages. Professor F. A. Hayek, his former student, has written: “But his [Mises'] influence reached far beyond his personal circle. For he alone has given us a conclusive treatment of all economic and social thought.”
The editor deserves credit, first of all, for her initiative in honoring Doctor Mises, and secondly, for her tireless effort in preparing the material submitted in four different languages, by nineteen individualistic authors, from six different countries, for publication in English. She also contributed a short biography of Doctor Mises.
The essays, grouped under six general headings, carry a unifying thread traceable to the philosophy which Doctor Mises has done so much to develop. They contain many thought-provoking ideas.
One, Grato Animo Beneficiique Memores, contains essays in tribute to Doctor Mises and his works. Jacques Rueff, a French professor and public servant, commends Mises for “the imperturbable intransigence of his lucid thinking.” William E. Rappard finds in his country, Switzerland, what he considers an exception to the laws of human action as described by Mises. Nevertheless, he acclaims “the revered dean of twentieth-century liberals . . . . the most outspoken and least compromising advocate of a complete policy of pure laissez-faire in the world today.” Reviews by Henry Hazlitt of two of Mises’ most important books—Socialism and Human Action—are also reprinted in this section.
Included in Part Two, On the Nature of Man and Government, there is another contribution by Mr. Hazlitt. In this essay, “The Road to Totalitarianism,” he reminds the reader that the inevitable end-product of centralization is “total control over what people do, say, and think.” The French economist and journalist, Bertrand de Jouvenel, in his essay, “Order vs. Organization,” explains why men who understand little about the science of human action so often believe governments should instigate “order” by force. “Men have a tidiness-preference . . . . It takes no great psychological acumen to observe that we enjoy passing judgments on matters of which we know very little.” In an essay, “On Democracy,” Hans F. Sennholz contrasts the totalitarian “People’s Democracies” with the “Western Democracies.” “To defend capitalism we must demonstrate the advantages of freedom and free enterprise to the people.” In “The Greatest Economic Charity,” F. A. Harper of this Foundation’s staff defines true charity and concludes: “He who would serve his fellow men by charity can best do so by saving and investing in tools.”
Part three includes five studies On Scientific Method, a phase of Mises’ work which truly deserves the serious attention of economists. The authors include a German (Wilhelm Röpke), Spanish-born Mexican (Faustino Ballvé), an Italian (Carlo Antoni), and two professors of this country, Louis M. Spadaro and Austrian-born Fritz Machlup. Röpke calls the market economy “an institution which goes . . . far in translating subjective feelings into objective actions,” but he warns lest this “lure the unwary into pushing forward unduly the frontier that delimits the border territory, the zone between what is human and what is mechanical.” Ballvé points out that “economics is neither pursuit of wealth, nor the production or distribution of commodities and services, nor their consumption. These are results . . . . These actions only concern economics when they originate from the autonomous action of man exercising his elective faculty in the market.” Antoni contrasts historical knowledge, i.e., “individual facts,” with economics. “An economic law classifies the situation, renders it typical, and thus abstracts . . . . in order . . . to deduce the subsequent action of the economic factor, i.e., individual interest.” Spadaro discusses “Averages and Aggregates in Economics,” explaining that “to the extent that economic action is ultimately dependent for explanation on individual differences, the employment of averages puts us out of reach of such explanation simply by understating these differences . . . . the distortion brought into play by the use of averages cannot, ironically, itself be ‘averaged out.’” Machlup criticizes those “social scientists” who are “apparently ashamed of the one thing that really distinguishes social sciences from natural sciences, name-ly, the fact that the student of human action is himself an acting human being . . . .”
Part four concerns The Economics of Free Enterprise. L. M. Lachmann, a German-born professor now living in South Africa, discusses “The Market Economy and the Distribution of Wealth,” pointing out that “wealth . . . . passes from hand to hand as unforeseen change confers value now on this, now on that specific resource, engendering capital gains and losses.” Leonard E. Read, FEE’s president, calls attention in his essay, “Unearned Riches,” to the logical consequence of the “subjective theory of value based upon the judgments of countless individuals . . . . This means gains for all participants in the exchange process, gains which must always appear to be unearned in terms of labor expended.” W.H. Hutt, an Englishman, now a professor of economics in South Africa, reviews the literature on his topic, “The Yield from Money Held,” and concludes that “the demand for money assets is a demand for productive resources.” William H. Peterson, an associate professor at New York University, in “The Accelerator and Say’s Law,” writes that if-:Keynes had been right, “we should witness the overnight industrialization of India.” Murray N. Rothbard, in pointing “Toward a Reconstruction of Utility and Welfare Economics,” stresses that “psychological magnitudes cannot be measured since there is no objectively extensive unit—a necessary requisite of measurement . . . . We can only say that ‘social welfare’ (or better, ‘social utility’) has increased due to a change, if no individual is worse off because of the change (and at least one is better off).”
Part five deals with The Hampered Market Economy. F. A. Hayek, in his “Progressive Taxation Reconsidered,” comments, “Not only will services which before taxation receive the same reward leave very different net rewards to those who rendered them; a much larger payment for one service may indeed leave less to him who rendered it than a smaller payment to another person . . . . [Thus] progressive taxation inevitably offends against what seems to me the most basic principle of economic justice, that of ‘equal pay for equal work.’” Percy L. Greaves, Jr., asks, “Is Further Intervention a Cure for Prior Intervention?” as he analyzes the so-called “right-to-work” laws. Behind such laws is “the philosophy that production is a form of ‘class warfare’ between employers and employees . . . . the agitators for ‘right-to-work’ laws forget . . . that the problem is basically one of getting the government out of moral business transactions and not into them . . . . The economic answer is to repeal the bad intervention and not try to counterbalance it with another bad intervention.”
The last section, On Socialism, contains a single essay entitled “French Socialism,” by a Belgian-born Frenchman. Louis Baudin describes the confusion among his countrymen who call themselves “socialists.” “Thus socialism is nothing more than a label affixed to a flask whose contents vary according to the whim of the shopkeeper . . . . its greatest strength is its vagueness: everybody believes what he wants to, adding to it some of his own ideals.”
Perhaps it is fitting to close by quoting the words of one of the contributors to this volume—a book published in tribute to a great scientist:
Professor Mises’ main renown is as an economist. Yet to me he is a charitable person even more than an economist. His charity is . . . . in the form of his inspiring mind and spirit. In my opinion there can be no greater charity than this, for it endures beyond any material form of benevolence. (F. A. Harper)