Ludwig von Mises: Scholar, Creator, Hero Part 3

Ludwig von Mises: Scholar, Creator, Hero Part 3
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Exile and the New World

More alert than any of his colleagues to the ever-encroaching Nazi threat in Austria, Mises accepted a chair in 1934 as professor of International Economic Relations at the Graduate Institute of International Studies at the University of Geneva. Since the initial contract at Geneva was only for one year, Mises retained a part-time post at the Chamber of Commerce, on one-third salary. Mises’s contract was to be renewed until he left Geneva in 1940. While it saddened him to leave his beloved Vienna, Mises was happy during his six years in Geneva. Established at his first (and last!) paid academic post, he was surrounded by such friends and likeminded colleagues as jurist and economist William E. Rappard, president of the Institute; Institute co-director Paul Mantoux, the eminent French economic historian; Mises’s boyhood friend, the distinguished jurist Hans Kelsen; Wilhelm Röpke, who had left Germany because of the Nazis; and French scholars Louis Rougier and Louis Baudin.

Mises’s lectures were in French, but he was fluent in French, and spoke it with no trace of an accent. Teaching only one weekly seminar on Saturday mornings, and divested of his political and administrative duties at the Chamber, Mises finally enjoyed the leisure to embark upon, and finish, his great masterpiece integrating micro- and macro-economics, the analysis of the market and of interventions into that market, all constructed on the praxeological method that he had set forth in the 1920s and early 1930s. This treatise was published as Nationalökonomie (Economics) in Geneva, in 1940.

Despite these favorable conditions, it took great courage for Mises to continue his work in the face of the tidal wave of Keynesian economics after 1937, and of the growth of socialist doctrines of left and right, as well as the onrush of Nazism and the imminence of a second horrible world war. In 1938, Mises was horrified to see the Nazi conquest of Austria, accompanied by the Nazi destruction of his personal library and papers, but he was cheered by being able to marry his fiancée, Margit Sereny, when she was able to flee to Geneva.[46]

The onset of World War II put an enormous amount of pressure on the Miseses. In addition to depriving the Institute of its non-Swiss students, the war meant that refugees, such as Mises, were increasingly made to feel unwelcome in Switzerland. Finally, when the Germans conquered France in the spring of 1940, Ludwig, prodded by his wife, decided to leave a country now surrounded by the Axis powers and flee to the Mecca for the victims of tyranny, the United States.

Emigration to the United States was a particularly harrowing experience for Mises. Here he was, a man of nearly sixty, in contrast to his fluency in French only book-learned in English, fleeing from a lifetime in Europe, impoverished, with no prospect of a job in the United States, forced to dodge German troops as he and Margit made their way across France to Spain and finally Lisbon, where they embarked for the United States. His entire world, his hopes and dreams, were shattered, and he was forced to make a new life in a new country with an unfamiliar language. And to top it all, as he saw a world succumbing to war and statism, his great masterpiece, Nationalökonomie, published during wartime conditions, had sunk without a trace. World War II was no time to interest anyone in high theory. Moreover, the book was not allowed to reach the German-speaking countries which constituted its natural market, and its Swiss publishing firm failed during the war.

The Miseses arrived in New York City in August 1940. Lacking any prospect of employment, the couple lived off meager savings, moving repeatedly in and out of hotel rooms and furnished apartments. It was the lowest point of Mises’s life, and shortly after he landed he began writing a despairing, searing intellectual memoir which he finished in December, and which was translated and published after his death as Notes and Recollections (1978).[47] A major theme in this poignant work is the pessimism and despair that so many classical liberals, friends and mentors of Mises, had suffered from the accelerating statism and destructive wars of the twentieth century. Menger, Böhm-Bawerk, Max Weber, Archduke Rudolf of Austria-Hungary, Mises’s friend and colleague Wilhelm Rosenberg — had all been broken in spirit or driven to death by the intensifying gloom of the politics of their time. Mises, throughout his life, resolved to meet these grave setbacks by fighting on, even though the battle might seem hopeless. In discussing how fellow classical liberals had succumbed to the despair of World War I, Mises then recounts his own response:

I thus had arrived at this hopeless pessimism that for a long time had burdened the best minds of Europe…. This pessimism had broken the strength of Carl Menger, and it overshadowed the life of Max Weber….

It is a matter of temperament how we shape our lives in the knowledge of an inescapable catastrophe. In high school I had chosen the verse by Virgil as my motto: Tu ne cede malis sed contra audentior ito (“Do not yield to the bad, but always oppose it with courage”). In the darkest hours of the war, I recalled this dictum. Again and again I faced situations from which rational deliberations could find no escape. But then something unexpected occurred that brought deliverance. I could not lose courage even now. I would do everything an economist could do. I would not tire in professing what I knew to be right.[48]

It was at that point, Mises went on, that he decided to write the book on socialism which he had contemplated before the outbreak of World War I.

Every other terrible situation faced by Mises in his life was met by the same magnificent courage: in the battle against inflation, the struggle against the Nazis, the flight during World War II. In every case, no matter how desperate the circumstance, Ludwig von Mises carried the fight forward, and deepened and expanded his great contributions to economics and to all the disciplines of human action.

Life began to improve for Mises when his old connection with John Van Sickle and the Rockefeller Foundation led to a small annual grant via the National Bureau of Economic Research, a grant which began in January 1941 and was renewed though 1944. From these grants emerged two important works, the first books of Mises written in English, both published by the Yale University Press in 1944. One was Omnipotent Government: The Rise of the Total State and Total War.[49] The dominant interpretation of Nazism in that era was the Marxist view of Columbia University Professor and German refugee Franz Neumann: that Nazism was the last desperate gasp of German big business, anxious to crush the rising power of the proletariat. That view, now thoroughly discredited, was first challenged by Omnipotent Government, which pointed out the statism and totalitarianism that underlay all forms of left-wing and right-wing collectivism. The other Mises book, Bureaucracy, was a marvelous little classic, which delineated, as never before, the necessary differences between profit-seeking enterprise, the bureaucratic operation of nonprofit organizations, and the far worse bureaucracy of government.

Yale University Press published Mises’s first English works in the teeth of an overwhelming dedication to socialism and statism by the major book publishers of that era. The press was secured for publishing Mises by his first new friend in the United States, the prominent economic journalist, Henry Hazlitt, then the lucid editorial writer and economist for the New York Times. Hazlitt had admired Mises since he had glowingly reviewed the English edition of Socialism in the Times in 1938. Hazlitt met Mises shortly after his arrival in the United States, and he soon became a close friend and disciple, writing prolifically and creatively on Austrian economics and tirelessly advancing the cause of Mises the person as well as the scholar.[50]

In early 1943, after Mises had completed the manuscript of Omnipotent Government, Hazlitt steered it to the libertarian-minded editor at Yale University Press, Eugene Davidson, who was enthusiastic about the book. From then on through the 1950s, the prestigious Yale Press served as the publisher of all of Mises’s work, both new and reprint. In fact, it was Davidson who suggested, in early 1944, that Mises write a short book on bureaucracy, and Mises completed the manuscript by June of that year.

Through Hazlitt’s good offices, Mises published nine articles for the New York Times, on world economic problems, during 1942 and 1943. This spread Mises’s ideas in the United States, and in January 1943, led Noel Sargent, secretary of the National Association of Manufacturers — an organization then devoted to laissez-faire — to invite Mises to join the Economic Principles Commission of the NAM. Mises served on the NAM Commission from 1943 to 1954, and was hence able to meet many of the leading industrialists devoted to a free market economy.[51]

But it remains an ineradicable blot on the record of American academia that Mises was never able to find a paid, full-time post in any American university. It is truly shameful that at a time when every third-rate Marxoid refugee was able to find a prestigious berth in academia, that one of the great minds of the twentieth century could not find an academic post. Mises’s widow Margit, in her moving memoir about life with Lu, records their happiness and her gratitude that the New York University Graduate School of Business Administration, in 1945, appointed Mises as Visiting Professor teaching one course a term. Mises was delighted to be back at university teaching; but the present writer cannot be nearly as enthusiastic about a part-time post paying the pittance of $2,000 a year. Mises’s course was, at first, on “Statism and the Profit Motive,” and it later changed to one on “Socialism.” This part-time teaching post was renewed until 1949.

Harold Luhnow, of the William Volker Fund, took up the crusade of finding Mises a suitable full-time academic post. Since obtaining a paid position seemed out of the question, the Volker Fund was prepared to pay Mises’s entire salary. Even under these subsidized conditions, however, the task was difficult, and finally New York University Graduate School of Business agreed to accept Mises as a permanent “Visiting Professor,” teaching, once again, his beloved graduate seminar on economic theory.[52][53] Mises began teaching his seminar every Thursday night in 1949, and continued to teach the seminar until he retired, still spry and active twenty years later, at the age of 87, the oldest active professor in America.

Even under these favorable financial conditions, NYU’s support for Mises was grudging, and only came about because advertising executive and NYU alumnus Lawrence Fertig, an economic journalist and close friend of Mises and Hazlitt, exerted considerable influence at the university. Fertig, in fact, became a member of the NYU Board of Trustees in 1952. Even so, and even though Mises was allowed to supervise doctoral dissertations, he still carried the stigma of “Visiting Professor.” More important, after Dean G. Rowland Collins, an admirer of Mises, retired, succeeding Deans did their best to undercut student registration in Mises’s courses, claiming that he was a reactionary and Neanderthal, and that his economics was merely a “religion.”

It must have been galling to Mises that, in contrast to his shabby treatment at the hands of American academia, favorite former students who had abandoned Misesian doctrines for Keynesianism, but whose only real contributions to economics had come as Misesians, received high and prestigious academic posts. Thus Gottfried Haberler was ensconced as full professor at Harvard, and Fritz Machlup went to John Hopkins and later to Princeton. Oskar Morgenstern, too, landed at Princeton. All of these high academic positions were, of course, paid for by the university.[54]

Mises never expressed any bitterness at his fate or at the apostasy of his former followers, nor indeed did he communicate sourness of any kind to his inspired and admiring seminar students. Only once did the present writer, his seminar student for ten years and friend for the rest of his life, hear him express any sadness or bitterness at his treatment by American academia. The occasion was the Columbia University Bicentennial of 1954, an event that led Columbia to invite prominent scholars from all over the world to speak and participate. Mises saw his old students, Hayek, Machlup, Haberler, and Morgenstern, invited to speak, but Mises, who lived less than a mile from Columbia, was totally ignored. And this, even though four of Mises’s former students — Mintz, Nurkse, Hart, and the qualitative school banking theorist Benjamin H. Beckhart — were teaching at Columbia University. Margit von Mises writes that only once did he express to her any longing for an academic post — after visiting his old friend, the monetary economist Winfield W. Riefler, at the Institute for Advanced Study in Princeton. She writes that “I remember Lu once told me that Riefler’s job at Princeton was the only position that really would have made him happy. It was very unusual for Lu to express a longing for something out of his reach.”[55] If there were any justice in the academic world, the Institute heads should have beaten down Mises’s doors, clamoring for him to join them.

For the present writer, who was privileged to join the Mises seminar in its first session in 1949, the experience at the seminar was inspiring and exhilarating. The same was true of fellow students who were not registered at NYU, but audited the seminar regularly for years, and consisted of libertarian and free-market scholars and businessmen in the New York area. Due to the special arrangements of the seminar, the university agreed to allow Misesians to audit the course. But even though Mises had a small number of excellent graduate students who did their doctorates under him — notably Israel M. Kirzner, still teaching at NYU — the bulk of the regular students were uncomprehending business students, who took the course for an easy A.[56] The proportion of libertarians and budding Austrians to the class total ranged, I would estimate, from about one-third to one-half.

Mises did his best to replicate the conditions of his great Vienna Privatseminar including repairing after the end of the formal session at 9:30 PM to Childs’ Restaurant to continue informal and animated discussions. Mises was infinitely patient and kind with even the most dimwitted of us, constantly tossing out research projects to inspire us, and always encouraging the shiest and most awestruck to speak. With a characteristic twinkle in his eye, Mises would assure them: “Don’t be afraid to speak up. Remember, whatever you say about the subject and however wrong it might be, the same thing has already been said by some eminent economist.”

However wonderful the seminar experience for knowledgeable students, I found it heartbreaking that Mises should be reduced to these frowzy circumstances. Poor Mises: there was scarcely a Hayek or a Machlup or a Schütz among these accounting and finance majors, and Childs’ Restaurant was no Viennese cafe. But one incident corrected some of this view. One day, Mises was invited to speak before the graduate economic students and faculty at Columbia University, a department then rated among the top three economics departments in the country. Typical of the questions after his talk was this: “Professor Mises, you say you are in favor of repealing measures of government intervention. But doesn’t such repeal itselfconstitute an act of intervention?” To this inane question, Mises gave a perceptive and telling reply: “Well, in the same way, you could say that a physician who rushes to the side of a man hit by a truck, is ‘intervening’ with the man in the same way as the truck.” Afterwards, I asked Professor Mises how he liked the experience. “Eh,” he replied, “I like my students [at NYU] better.” After that, I realized that perhaps Mises’s teaching at NYU was truly worthwhile, even from his point of view.[57]

As early as 1942, Mises, dismayed but undaunted by the sad fate of Nationalökonomie, began work on an English-language version of the book. The new book was not simply an English translation ofNationalökonomie. It was revised, better written and greatly expanded, so much so as to be virtually a new book.[58] It was the great work of Mises’s life. Under the care and aegis of Eugene Davidson, the Yale University Press published the new treatise in 1949 as Human Action: a Treatise on Economics.[59]

Happily, the opening of Mises’s seminar coincided with the publication of Human Action, which came out on September 14, 1949. Human Action is it: Mises’s greatest achievement and one of the finest products of the human mind in our century. It is economics made whole, based on the methodology of praxeology that Mises himself had developed, and grounded in the ineluctable and fundamental axiom that human beings exist, and that they act in the world, using means to try to achieve their most valued goals. Mises constructs the entire edifice of correct economic theory as the logical implications of the primordial fact of individual human action. It was a remarkable achievement, and provided a way out for the discipline of economics, which had fragmented into uncoordinated and clashing sub-specialties. It is remarkable thatHuman Action was the first integrated treatise on economics since Taussig and Fetter had written theirs before World War I. In addition to providing this comprehensive and integrated economic theory, Human Action defended sound, Austrian economics against all its methodological opponents, against historicists, positivists, and neo-classical practitioners of mathematical economics and econometrics. He also updated his critique of socialism and interventionism.

In addition, Mises provided important theoretical corrections of his predecessors. Thus, he incorporated the American Austrian Frank Fetter’s pure time preference theory of interest into economics, at long last rectifying Böhm-Bawerk’s muddying of the waters by bringing back the fallacious productivity theory of interest after he had disposed of it in the first volume of his Capital and Interest.

It is another blot on American academia that I had gone through all the doctoral courses at Columbia University without once discovering that there was such a thing as an Austrian school, let alone that Ludwig von Mises was its foremost living champion. I was scarcely familiar with Mises’s name, outside of the usual distorted story of the socialist calculation debate, and was therefore surprised to learn in the spring of 1949 that Mises was going to begin a regular seminar at NYU. I was also told that Mises was going to publish a magnum opus in the fall. “Oh,” I asked, “what’s the book about?” “About everything,” they replied.

Human Action was indeed about everything. The book was a revelation to those of us drenched in modern economics; it solved all problems and inconsistencies that I had sensed in economic theory, and it provided an entirely new and superb structure of correct economic methodology and theory. Furthermore, it provided eager libertarians with a policy of uncompromising laissez-faire; in contrast to all other free-market economists of that day or later, there were no escape hatches, no giving the case away with “of course, the government must break up monopolies,” or “of course, the government must provide and regulate the money supply.” In all matters, from theoretical to political, Mises was the soul of rigor and consistency. Never would Mises compromise his principles, never would he bow the knee to a quest for respectability or social or political favor. As a scholar, as an economist, and as a person, Ludwig von Mises was a joy and an inspiration, an exemplar for us all.

Human Action was and continues to be a remarkable publishing phenomenon. The book to this day is a best seller for the press, so much so that the publisher refuses to put it into paperback. This is truly noteworthy for a massive and intellectually difficult work such as Human Action. Astonishingly, the book was made an alternate selection of the Book-of-the-Month Club, and it has been published in Spanish, French, Italian, Chinese, and Japanese editions.[60] Thus, through Human Action Mises was able to forge an Austrian and laissez-faire movement of national and even international scope.

Remarkably too, the Misesian movement forged by Human Action was multi-class: it ranged from scholars to students to businessmen, ministers, journalists, and housewives. Mises himself always placed great importance on outreach to businessmen and the general public. At one time, there were plans afoot for a graduate school, entitled the American School of Economics, to be financed by J. Howard Pew with Mises as president. Some of us younger Misesian scholars were on the Board of Trustees. Mises emphasized that, as was common in Europe, the faculty of the school should give periodic lectures to the general public, so that sound economic education would not be confined to professional scholars. Unfortunately, plans for the school eventually fell through.

Yale University Press was so impressed with the popularity as well as the quality of Mises’s book that it served for the next decade as the publisher of his work. The press published a new, expanded edition ofSocialism in 1951, and a similarly expanded edition of The Theory of Money and Credit in 1953. Remarkably, too, Mises did not rest on his laurels after the publication of Human Action. His essay on “Profit and Loss” is perhaps the best discussion ever written of the function of the entrepreneur and of the profit-and-loss system of the market.[61] In 1957, the press published Mises’s last great work, the profound Theory and History, his philosophical masterpiece that explains the true relation between praxeology, or economic theory, and human history, and engages in a critique of Marxism, historicism, and various forms of scientism. Theory and History was, understandably, Mises’s favorite next to Human Action.[62] However, after the departure in 1959 of Eugene Davidson to be founding editor of the conservative quarterly Modern Age, Yale University Press no longer served as a friendly home for Mises’s works.[63] In its final years the publishing program of the William Volker Fund took up the slack, and provided the world with an English edition of Liberalismus (as The Free and Prosperous Commonwealth), and of Grundprobleme der Nationalökonomie (as Epistemological Problems of Economics), both published in 1962. Also, in the same last year of Volker Fund existence, the Fund published Mises’s final book, The Ultimate Foundation of Economic Science: An Essay on Method, a critique of logical positivism in economics.[64]

During his post-World War II American years, Mises experienced ups and downs from observing the actions and influence of his former students, friends, and followers. On the one hand, he was happy to be one of the founding members in 1947 of the Mont Pelerin Society, an international society of free market economists and scholars. He was also delighted to see such friends as Luigi Einaudi, as President of Italy, Jacques Rueff, as monetary adviser to general Charles De Gaulle, and Röpke and Alfred Müller-Armack as influential advisers of Ludwig Erhard, play a major role in shifting their respective nations, during the 1950s, in the direction of free markets and hard money. Mises played a leading part in the Mont Pelerin Society in early years, but after a while became disillusioned with its accelerating statism and mushy views on economic policy. And even though Mises and Hayek maintained cordial relations until the end, and Mises never spoke a bad word about his long-time friend and protégé, Mises was clearly unhappy about the developing shift in Hayek after World War II away from Misesian praxeology and methodological dualism, and toward the logical empiricism and neo-positivism of Hayek’s old Viennese friend Karl Popper. Mises pronounced himself “astonished” when Hayek, in a lecture in New York on “Nomos and Taxis” in the 1960s, clearly if implicitly repudiated the praxeological methodology of his own Counter-Revolution of Science. And Mises, while generally admiring Hayek’s 1960 work on political philosophy and political economy, The Constitution of Liberty, took Hayek gently but firmly to task for holding that the Welfare State is “compatible with liberty.”[65]

After failing for the last two years of his life, the great and noble Ludwig von Mises, one of the giants of our century, died on October 10, 1973, at the age of 92. It is ironic that the following year, Friedrich A. Hayek received the Nobel Prize in Economics, not for his later philosophical meanderings and lucubrations, but precisely and explicitly for the work he did, in the 1920s and 1930s, as an ardent Misesian, in elaborating Mises’s theory of business cycles. Ironic because if anyone deserved the Nobel Prize more than Hayek, it was clearly his mentor, Ludwig von Mises. Those of us given to cynical speculation might judge that the Nobel Prize Committee of Sweden deliberately held off the award until Mises’s death, for otherwise they would have had to give the award to someone they considered impossibly dogmatic and reactionary.

The Nobel Prize to Hayek, combined with the growing Misesian movement of the preceding fifteen years, sparked a veritable “takeoff” stage for a revival of Austrian economics. For one thing, the general run of economists, virtually obsessed with the Nobel Prize, and never having heard of Hayek, felt obliged to investigate what this person may have done. Hayek’s was also the first Nobel to break the logjam of giving the award only to mathematicians and Keynesians; since then, numerous free-market economists have obtained the award.

Since 1974, the revival of Austrian economics and of interest in Mises and his ideas has accelerated greatly. Scorned for the last four decades of Mises’s life, Austrian economics in general, and Mises in particular, are now generally considered, at the very least, a worthy ingredient amidst the current potpourri and confusion of economic thought and opinion. The academic climate is surely very different now, and infinitely better, than it was in the dark days that Mises could not find a suitable academic post.

For a few years after 1974, a revival of Austrian economics flourished, and there were notable conferences and published volumes each year. But then the tide seemed to turn, and by the late 1970s centers and institutes previously devoted to the resurgence of Misesian economics began to lose interest. The conferences and books slowed down, in quantity and in quality, and we began to hear once again the old canards: that Mises was too “extreme” and too “dogmatic,” and that it would be impossible to continue as a Misesian and gain “respectability” in the world, to achieve political influence, or, in the case of young academics, to acquire their tenure. Former Misesians began to pursue strange gods, to find great merit in such creeds that Mises detested as the German Historical School, institutionalism, nihilism, and even to prate about a “synthesis” with Marxism. Worse yet, some of these younger Austrians were actually trying to imply that Mises himself, a man who dedicated his entire life to the truth, would actually have blessed such abhorrent maneuverings.

Fortunately, just as it seemed that the Misesian path would be lost once again, the Ludwig von Mises Institute was formed in 1982. Its lusty development since then has, virtually singlehandedly, revived Misesian economics and placed it in the dominant position in the growing Austrian movement. Through an annual scholarly journal, The Review of Austrian Economics, a quarterly Austrian Economics Newsletter, a monthly periodical The Free Market, a growing publication program of books, occasional papers, andworking papers, annual instructional seminars, policy conferences, numerous non-residential graduate fellowships, and resident fellowships at Auburn University and other universities across the country, the Mises Institute has finally established Austrianism not only as a viable new paradigm for economics but astruly Austrian. In short, in the spirit and the content of the marvelous body of thought that we have inherited from the great Mises. Also in the spirit of Mises, the Institute has forged a multi-level program, from the highest reaches of scholarship, to speaking out boldly on the important concrete policy issues of our time. Hence, after some fits and starts, and thanks to the Mises Institute, we have at last forged an Austrian revival that Mises would be truly proud of. We can only regret that he did not live to see it.

Coda: Mises the Man

Who was Mises the Man? Since his death, some of his most beloved students of the 1920s, particularly F.A. Hayek, have disseminated the view that Mises was “difficult,” “stern,” “severe,” not personally close to his students, and even “personally obnoxious.” These strictures were either given to interviewers, or inserted as barbs in the midst of an effusion of praise for Mises.[66] But is this the sort of teacher who all of his life had gathered around him enthusiastic admirers and followers? Certainly, I can testify that all his American followers were steeped, not only in admiration for the greatness and rigor of his intellect and creative powers, and for his indomitable courage, but also in love with the sweetness of his soul. And if it is to be thought that somehow his personality had been harsher in the 1920s, what kind of an aloof or impersonal mentor would induce a man like Felix Kaufmann to compose songs in honor of Mises’s seminar?[67]

Not only were we American students deeply stirred by Mises the man, but we all realized that in Mises we were seeing the last trailing clouds of glory of the culture of pre-World War I Old Vienna, a far finer civilization than we will know again. William E. Rappard, a man of Mises’s own age, caught this spirit very well in his tribute to Mises in the Festschrift prepared in 1956. Rappard wrote of Mises that, in the Geneva years,

I very often, and I am afraid, very indiscreetly, enjoyed his company. All those who have ever had a like privilege realize that he is not only one of the keenest analytical minds among contemporary economists, but that he also has at his disposal a store of historical culture, the treasures of which are animated and illuminated by a form of humanity and Austrian wit rarely to be found today on the surface of this globe. In fact, I sometimes wonder, not without fear, whether our generation is not the last to be blessed with what seems to have been a monopoly of pre-war Vienna.[68]

But the finest words of appreciation of Mises the man were delivered in the course of a perceptive andelegantly written tribute to Mises’s ideas by his long-time admirer Professor Ralph Raico:

For over sixty years he was at war with the spirit of the age, and with every one of the advancing, victorious, or merely modish political schools, left and right.

Decade after decade he fought militarism, protectionism, inflationism, every variety of socialism, and every policy of the interventionist state, and through most of that time he stood alone, or close to it. The totality and enduring intensity of Mises’s battle could only be fueled from a profound inner sense of the truth and supreme value of the ideas for which he was struggling. This — as well as his temperament, one supposes — helped produce a definite “arrogance” in his tone (or “apodictic” quality, as some of us in the Mises seminar fondly called it, using one of his own favorite words), which was the last thing academic left-liberals and social democrats could accept in a defender of a view they considered only marginally worthy of toleration to begin with….

But the lack of recognition seems to have influenced or deflected Mises not in the least.[69]

And Professor Raico concludes with this marvelous and discerning passage:

No appreciation of Mises would be complete without saying something, however inadequate, about the man and the individual. Mises’s immense scholarship, bringing to mind other German-speaking scholars, like Max Weber and Joseph Schumpeter, who seemed to work on the principle that someday all encyclopedias might very well vanish from the shelves; the Cartesian clarity of his presentations in class (it takes a master to present a complex subject simply); his respect for the life of reason, evident in every gesture and glance; his courtesy and kindliness and understanding, even to beginners; his real wit, of the sort proverbially bred in the great cities, akin to that of Berliners, or Parisians and New Yorkers, only Viennese and softer — let me just say that to have, at an early point, come to know the great Mises tends to create in one’s mind life-long standards of what an ideal intellectual should be. These are standards to which other scholars whom one encounters will never be equal, and judged by which the ordinary run of university professor — at Chicago, Princeton, or Harvard — is simply a joke (but it would be unfair to judge them by such a measure; here we are talking about two entirely different sorts of human beings).

When Mises died, and I was preparing an obituary, Professor Raico kindly sent me a deeply moving passage from Adonais, Shelley’s great eulogy to Keats, that, as usual for Raico, struck just the right note in a final assessment of Mises:

For such as he can lend — they borrow not

Glory from those who made the world their prey:

And he is gathered to the kings of thought

Who waged contention with their time’s decay,

And of the past are all that cannot pass away.[70]


[46] On the Geneva years, see Mises, My Years, pp. 31–49, and Mises, Notes, pp. 136–138.

[47] A decade or so later, after Mises had launched his graduate seminar at New York University, some of us, during a post-seminar snack at Childs’ Restaurant, reacted to some of the marvelous anecdotes Mises told us about the old days in Vienna by suggesting that he write his autobiography. Mises drew himself up, in a rare moment of severity, and declared; “Please! I am not yet old enough to write my autobiography.” It was a tone that brooked no further discussion. But since Mises was then in his seventies — a very advanced age to the rest of us — and since this is a country where twerps of twenty are publishing their “autobiographies,” we naturally though silently, disagreed with the master.

[48] Mises, Notes, pp. 69–70.

[49] An earlier version of Omnipotent Government, dealing only with Germany and Austria, had been written in German in Geneva just before the outbreak of World War II; after arrival in the United States, Mises added an appendix. This earlier and smaller work was published after Mises’s death in Stuttgart, in 1978, under the title, Im Namen des Staates oder Die Gefahren des Kollektivismus (In the Name of the State, or the Dangers of Collectivism.)

[50] Hazlitt relates the story of his first personal contact with Mises: “One night at home, I received a telephone call, and the voice on the other end of the wire said, ‘This is Mises speaking.’ As I later told some of my friends, it was almost as if somebody had said, ‘This is John Stuart Mill speaking.'” Mises, My Years, p. 58.

[51] These included J. Howard Pew of Sun Oil Company, the major financial contributor to laissez-faire causes; B.E. Hutchinson, vice-chairman of Chrysler; and Robert Welch, of Welch Candy Corp., who went on in the late 1950s to found the John Birch Society.

[52] Harold W. Luhnow was head of the William Volker Company a furniture distributing house in Kansas City, and of the William Volker Fund, which played a vitally important but still unsung role in supporting libertarian and conservative scholarship from the late 1940s until the early 1960s.

[53] For a while, Mises continued to teach his Socialism course as well as conduct his seminar. After a few years, the seminar was his only course at NYU.

[54] American academia treated F.A. Hayek, who was still a Misesian intellectually and politically, only slightly less shabbily than Mises. The Volker Fund tried to place Hayek at an American university, and was finally able to find a wholly subsidized post for Hayek at the University of Chicago. The Chicago economics department, however, rejected Hayek, but he was accepted at the scholarly but offbeat graduate Committee on Social Thought, where he had only a few, even though first-rate, graduate students. It was because the University of Chicago refused to pay Hayek any pension that he was forced to return to German and Austrian universities after reaching retirement age.

[55] Mises, My Years, p. 59.

[56] As a European professor, Mises never fully adapted to the grading system in the U.S. At first, he gave every student an A. When told he could not do that, he alternatively gave students As and Bs depending on their alphabetical placement. When told he could not do that, he settled on a policy of giving an A to any student who wrote a paper for the course, regardless of its quality and a B to everyone else.

[57] When the Volker Fund collapsed in 1962, Lawrence Fertig, with a consortium of other businessmen and foundations, kept the seminar going until Mises retired in 1969.

[58] I have been so informed by my German-American colleague, Professor Hans-Hermann Hoppe of the economics department of the University of Nevada, Las Vegas, a knowledgeable and creative praxeologist and Misesian.

[59] A particularly valuable assessment of the importance of publishing an English version ofNationalökonomie was sent to Davidson in January 1945 by Dr. Benjamin M. Anderson, monetary economist, economic historian, and friend of Mises, and formerly economist for the Chase National Bank. “Nationalokonamie is von Mises’s book on general economic principles. It is the central trunk, so to speak, of which the subject discussed in his book on money and his book on socialism are merely the branches. It is the fundamental theory of which the conclusions in the books on socialism and money are the corollaries.” Mises, My Years, p. 103.

[60] Thus, Human Action was able to surmount a vicious review in the New York Sunday Times Book Reviewby Harvard’s John Kenneth Galbraith, who chastized the Yale University Press for having the temerity to publish the book.

[61] “Profit and Loss” was written as a paper for the meeting of the Mont Pelerin Society held in Beauvallon, France, in September 1951. The essay was published as a booklet the same year by Libertarian Press, and is now available as a chapter in the selected essays of Mises, in Ludwig von Mises, Planning for Freedom (4th ed., South Holland, IL: Libertarian Press, 1980), pp. 108–150.

[62] Mises, My Years, p. 106. Unfortunately, Theory and History has been grievously neglected by much of the post-1974 Austrian School revival. See Murray N. Rothbard, “Preface,” Ludwig von Mises, Theory and History: An Interpretation of Social and Economic Evolution (2nd ed., Auburn University, AL: Ludwig von Mises Institute, 1985).

[63] The grisly story of the botched — seemingly deliberately — second edition of Human Action in 1963 can be found in Mises, My Years, pp. 106–111. The Yale University Press settled Mises’s lawsuit on this horrendous printing job out of court, giving in to virtually all his demands. The rights to publish were transferred to Henry Regnery & Co., which published the third edition of Human Action in 1966, but the Yale University Press continues to take its cut to this day. The worst aspect of the affair was the torment inflicted on this 82-year old intellectual giant, distressed at the mangling of his life’s masterwork.

[64] All three works were published by D. Van Nostrand, whose chairman was a Mises sympathizer, and who had a publishing arrangement with the Volker Fund. Grundprobleme was translated by George Reisman, and Liberalismus by Ralph Raico, both of whom started attending Mises’s seminar while still in high school in 1953. On Raico and Reisman, see Mises, My Years, pp. 136–137.

[65] Mises, Planning for Freedom, p. 219.

[66] See, for example, Craver, “Emigration,” p. 5; and Mises, My Years, p. 222.

[67] Mises, My Years, p. 211.

[68] William E. Rappard, “On Reading von Mises,” in M. Sennholz, ed., On Freedom and Free Enterprise: Essays in Honor of Ludwig von Mises (Princeton: D. Van Nostrand, 1956), p. 17.

[69] Ralph Raico, “The Legacy of Ludwig von Mises,” The Libertarian Review (September 1981), p. 19. The article was included in a Mises Centennial Celebration issue of the magazine. An earlier version was published in The Alternative, February 1975. The text is available here.

[70] Raico, “Legacy,” p. 22.

Profile photo of Murray N. Rothbard

Murray N. Rothbard (1926–1995) was dean of the Austrian School. He was an economist, economic historian, and libertarian political philosopher.

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