In today’s Wall Street Journal, the scholar after whom this blog is named — to honor him, not to insult him — is quoted; this quotation is from Hayek’s 1960 book, The Constitution of Liberty:
All political theories assume, of course, that most individuals are very ignorant. Those who plead for liberty differ from the rest in that they include among the ignorant themselves as well as the wisest. Compared with the totality of knowledge which is continually utilized in the evolution of a dynamic civilization, the difference between the knowledge that the wisest and that the most ignorant individual can deliberately employ is comparatively insignificant.
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Great quote Don. I think if the Austrian blogosphere kept Hayek and largely jettisoned von Mises, Rothbard, and some of the others they would be much better off for it. There’s a reason why Hayek was the one to win a Nobel Prize. All the bank paranoia and epistemological hangups distract from and I think even trivialize the incredibly substantial Hayekian contribution – his work on the uses of knowledge.
thats a slippery slope i wouldnt want to be on. if you want to ditch rothbard and mises as extremist,why not ditch hayek as well.we can all settle for freedom loving friedman.
no disrespect to all these economists and libertarians, but to claim that mr x represents true libertarianism just displays a lack of tolerance/embarrassment about the seemingly impractical nature of some of the ‘extreme views’ of libertarians
Well, I want to ditch them because I don’t find them convincing, not because they’re “extremists”. Hayek is significantly more convincing and always has been.This has nothing to do with libertarianism (although I certainly have thoughts on that as well) – this has to do with the Austrian school. The Keynesians have largely abandoned their Alvin Hansons. Why can’t the Austrian’s do the same? I think in some quarters there is a very strong “circle the wagons” mentality. The answer, I think, is that a lot of Austrians find von Mises and Rothbard to be relatively convincing. You rarely see the hosts of this blog cite them, though. I think there’s a good reason for that.
And I should say – I don’t consider myself an Austrian or a libertarian. But I do get a lot out of Hayek, and I was just passing on some friendly, unsolicited advice
Your point about Hayek’s work is well made, but I’ll disagree with you on Mises (at least). I found On Human Action to be as clear and influential as anything by Hayek or Friedman. It was a slog at times, and not as ‘modern’ in language as Hayek, but I would never throw Mises off the island. Socialism: An Economic and Sociological Analysis is outstanding and an honest critical take. If you haven’t read Mises you’re missing some thoughtful and powerful stuff.
And I should say, it’s not like I’m an Austrian expert (it’s not like I’m an any school of thought expert!). Just a general take that’s worth what it’s worth.
Keynesians should largely be abandoned.
– Keynes
That bastard died and now we are stuck with his Long Run!
Yes – read the preceding paragraphs and read the sentence that immediately follows this one where he says “that’s why I call my theory a general theory”. His point – right or wrong (I think he’s a little off on this) – is that neoclassical theory offers nothing for a command economy. It’s not informative to them at all. His theory, he suggests, has insights for a free market economy or a command economy, presumably because the very early, crude, underdeveloped version of Keynesianism does not rely on the microeconomic foundations (and assumptions) that came later.
He’s not saying he’s a fan of totalitarianism. It’s amazing to me how this quote is always latched onto and misread. If you read the whole preface it’s pretty obvious what he’s saying – he goes on and on about how his theory is more generalizable than other theories.
Why do you want to get rid of Mises?
His contribution to the socialist calculation problem was enormous.
But how bout we compromise…we can ditch Mises if you ditch Keynes….
Hmmm… given the degree to which Mises is ignored now I think I’ll keep my Keynes and just let you keep your Mises.
“Keeping” and “dropping” was a crude way to put it initially. Of course that is never done. I’m just curious why all the epistemelogical and ideological baggage keeps getting reception. The kooky stuff from Keynes – 4.0 multipliers, the uselessness of monetary policy, etc. etc. – no modern Keynesian believes that stuff any more. We respect the guy but understand he’s fallible and move on when Friedman trounces him. What frustrates me is not Mises or Rothbard per se – what frustrates me is that the Austrian school seems so insular that everything they ever wrote is passed down as being just as correct today (in some circles at least). But as I alluded to, that’s obviously not how all Austrians react. Don and Russ are fantastic about promoting the good Austrian stuff and making it clear that they don’t put much stock in the other Austrian stuff. If more Austrian sites were as discerning as Cafe Hayek, I think the Austrian school would get a lot more respect in the discipline. Right now, I’m sorry to say, it’s largely considered just about as irrelevant as Marxist economics – and for much the same reason.
The only reason the Austrian’s are considered “irrelevant” today is because of the implications that the Austrian theory represent. The people in power don’t want to hear what the Austrian’s have been saying for all these years…that government interference in the Market hurts…not helps like Keynes wants you to believe. Keynesian economics, give the government and politicians a carte blanche to do what ever they want, to spend as much as they want, on who ever they want all in the name of the Economy. And you wonder why they would consider the opposing view as “irrelevant?” It would mean they’d have to stop writing hot checks! Look at the incentives and I know you can reason out why they keep trying to reject the Austrian school. Which is why, IMO, you don’t like the Austrians, cause if you were an Austrian you could never be a Democrat.
What Keynesians say government interference helps? You really oughta be more specific on what kind of intervention is advocated, or it’ll become obvious to everyone that you’re just constructing a straw man to knock down.
Either way – I’m talking about rejection from the economics profession, not from people in government. I think most in government have a very tenuous grasp of any economic theory – they have ideological rules of thumb they go by. I’m not talking about them – I’m talking about the reception of the Austrian school by economists.
As much as I adore this Cafe – it didn’t inform me of the existence Albert Jay Nock’s Our Enemy, The State. The Mises Institute did. That isn’t meant to imply that our hosts dislike Nock’s work, or that they’ve never written about it, only that I discovered it by visiting the Mises site.There are many, many ways to advance the cause of liberty, but only one way to advance the cause of socialism: violence.
I don’t doubt the last point for a minute– as one finds a 7 foot tall man the same as a three foot tall girl from the perspective of 40,000 feet. But I wonder if the information resources available to skilled users now does make the gulf between the ignorant and the wise more economically significant. If our educational infrastructure allows the bell curve of skill and knowledge to flatten out, does the difference between the two opposites harm political and economic life because it allows the assumption that the merely capable are truly gifted with extraordinary wisdom? Does access to today’s incredible knowledge resources create an illusion of competence in an elite, and lend an unearned credence to central planning?
Those are good questions and points, sir.
If we only look at the facade it would seem that the internet can do much to equalize humanity.
But, no matter the ability of the individual to access great knowledge on anything, it is still the individual that must interpret it and put it to use, and given all the knowledge in the universe a fool is still a fool. A deceiver is still a deceiver, an evil one is still an evil one, etc. etc.
Go to mises.org and get the PDF of Human Action. It’s free so what do you have to lose? Or are you afraid that Mises might make your rethink your Keynesian ways?
I have the opportunity cost of another big stack of books I want to read.
Are there a few chapters you like that I can start with, though? Maybe that will convince me to put Mises at the top of the heap.
Chapters 3, 8 10-13, 15, 16, 19, 20, the section on Socialism and the section on the Hampered Market…
It should be easy reading for you.
Dear Mr. Kuehn,
You could start with von Mises very short book, “The Anti-Capitalist Mentality”.
I am friendly.
Best Regards,
Trude
Thanks