H. Rockwell, Jr., is president and founder of the Ludwig
von Mises Institute in Auburn, Alabama and editor of LewRockwell.com.
Ludwig von Mises (1881–1973) was a major economist and thinker
whose historic treatises include Human
Action and Socialism.
The mission of the Ludwig von Mises Institute is "to restore
a high place for theory in the social sciences, encourage a revival
of critical historical research, draw attention to neglected traditions
in Western philosophy, and promote the free and enterprising commonwealth."
Kantor: Ludwig von Mises entitled one of his books The
Anti-Capitalistic Mentality. What did he mean by this?
H. Rockwell, Jr.: It’s a marvelous book, written in 1956. It
still holds up. Mises addressed the question: why are the cultural
elites so biased against the free-market economy, and all it represents,
despite the evidence that it is the only system compatible with
a developed civilization?
took it for granted that huge sectors of the intelligentsia and
media are deeply ignorant of economics. In this book he addresses
the problem not of ignorance but hate: hatred of the businessman
and entrepreneur, and the assumptions that the business class is
secretly criminal, that the rich never deserve what they own, that
businesses that rake in profits by serving others through enterprise
somehow "owe" something to the "community,"
so, if they don't give it up voluntarily, it should be taken from
see this on display in these disgusting Enron hearings, lovingly
reported by the echo-chamber press. It's one thing to prosecute
crime, but this is anti-capitalism running wild. Nobody remembers
that during the u201890s boom phase of the market created by loose credit,
investors cared only about accounting in order to sell companies
with real earnings and buy those without. The conventional wisdom
on the street was that any company that paid dividends was worthless.
That's the topsy-turvy world that easy money created in the late
Enron was typical of major corporate start-ups during the boom phase
of the business cycle, but in 2001 the free market struck back with
a dose of reality. Unviable businesses melted. Thank goodness for
that! And now investors are wary, as they should be. There is a
wonderful witch-hunt on for companies that bury debt as subsidiaries,
and there is u2018fessing up all over the place. Truth at last, courtesy
of the market economy.
contrast this process with HUD, the post office, or any other federal
bureau. The GAO comes out with regular reports showing that these
agencies' books are in complete chaos, with tens of billions missing,
unaccounted for, or uncollectible. There are no earnings. There
are no dividends. And who cares? No one. In Washington, GAO reports
are used for scrap paper and birdcage lining.
so now we have these politicos who specialize in public relations
and wealth redistribution putting Enron on trial for alleged accounting
malpractice. And why? Because the company went belly-up. But the
market is supposed to punish unviable enterprises by shutting them
down. Lord knows that would never happen to a government agency.
Government specializes in keeping unprofitable operations going:
look at the history of industry in the Soviet Union, or at American
farming or the TVA.
What type of anti-capitalism did Mises draw attention to?
All of the same types of bias were present forty-six years ago when
Mises wrote his book. He noticed in those days that detective novels,
for example, frequently make the rich businessman the villain. In
movies, bureaucrats are heroic and public spirited while businessmen
are greedy, racist, and vaguely criminal. In popular music, the
"suits" are the ones ‘dissed.
for academia, outside one or two economics professors, nearly the
entire faculty of the typical university is reliably anti-capitalist.
As a class, academics can be depended on to oppose economic development,
support high taxes, and latch on to every anti-enterprise cause
that comes along.
of the anti-capitalism of the intellectuals is self-interest at
work: those paid by the state identify with the state and its interests.
There's also snobbery at work: most intellectuals hate commercial
culture. Well, folks, the glory of capitalism is that it permits
you to choose what to consume and what not to consume. If intellectuals
prefer the music of Anton Webern to Britney Spears, fine. Tower
Records offers both.
Mises’s analysis goes further to identify the problem of envy at
the root of anti-capitalism. Whether in the arts, entertainment,
or academia, the dominant players are talented people who believe
that they are wiser and better than the masses. They are appalled
that capitalism permits a B-school dropout to become a billionaire
while they scrape by for a measly raise when promoted from assistant
to associate professor. They set out to cripple the system that
brings this about.
yet this is not new. Since ancient times, the merchant has been
scorned and his profession considered ignoble. The philosopher who
strolls around speculating on the meaning of life is seen as the
highest form of humanity while the man who risks his own money to
make available food, shelter, medicine, clothing, and all the other
material goods that make life liveable is despised.
I'm all for philosophy and other academic disciplines; like the
priesthood, this is a vocation that requires sacrifice, and that
is essential. But celebrate the risk-taking merchant too. He is
a benefactor of mankind.
Radical environmentalists in Europe often vandalize and perpetrate
arson against McDonald’s restaurants. Is there a parallel between
this aggression and the attacks on the World Trade Center?
Notice that whenever looting of businesses occur, at these anti-globalist
events or in Europe when McDonald's restaurants are burned, the
press will frequently write that no violence has occurred, on grounds
that no one was hurt or killed. No violence? What do you call it
when gangsters destroy property for ideological reasons? You can
call it violence, or you might even call it terrorism. The Earth
Liberation Front has been doing this for years in the U.S., wrecking
research labs and burning the cars of scientists. It's hardly ever
about the people who worked at the WTC: traders, insurers, speculators,
retailers, lenders: financial experts whose contributions are essential
to our daily lives. They labored every day to overcome linguistic,
cultural, and regulatory barriers to unite the world in a great
commercial project to improve the lot of mankind. But public schools
teach that they are exploiters, Hollywood regards them as somewhat
criminal, and not one person in ten thousand can tell you why what
they do matters.
the hijackers were choosing targets, they figured that they would
smash these buildings because they somehow represented the "money
power." Well, not many among the culture elites in this country
or the rest of the world would really disagree with them. The urge
to destroy business and finance as a sector plays itself out in
politics and the media every day.
attack on the WTC put into action what millions of students are
taught every day in their college classrooms, what prime-time television
suggests night after night, what the sociology journals seek to
prove year after year: entrepreneurs and what they create are anti-social
and wholly dispensable.
enterprise and its symbols do not represent "money power"
or any other kind of power. They represent the coming together of
people to trade voluntarily with the hope of achieving material
advancement and progress.
watchwords of capitalism are persuasion and contract. Buying and
selling is a cooperative act. No one ever forced a Parisian to eat
a Big Mac. The urge to smash the system that makes it possible for
people to have more choices in life stems from ignorance and evil.
Without free enterprise, civilization would crumble and we would
all starve and die.
Has popular culture’s appreciation of these individuals increased
since September 11?
I wouldn't say so. We've gained a greater appreciation of rescue
workers, and that's great, though I notice that many of them are
seizing the opportunity to sue the city for personal damages. But
what about the people and the occupations that were actually targeted
by the killers?
anyone can name a single business that was smashed. Among them:
Morgan Stanley, Fred Alger Management, Cantor Fitzgerald, MassMutual,
Fiduciary Trust, Harris Beach & Wilcox, Oppenheimerfunds, Bank
of America, Kemper Insurance, Lehman Brothers, Dean Whitter, Credit
Suisse, and First Boston.
don't recall a single tribute to these institutions printed in the
popular press. I don't even rule out that many people among the
U.S. intelligentsia thought that because these people were on the
front lines of capitalism, they had it coming. Yet these are the
brokers who worked every day to invest our savings and channel resources
to their most profitable uses. These insurance companies provide
the valuable service of securing our lives and property against
accidents, and did far more to achieve their aims than the Office
of Homeland Security, which in fact has no real stake in the security
of anything but its own budget.
Have federal policies after September 11 reflected a greater appreciation
Again, the opposite has happened. At the World Economic Forum, held
in New York in memory of September 11, you couldn't tell the protestors
from the main speakers. The podium always seemed to be held by some
demagogue railing against the wealth of the West. Not one speaker
bothered to give a tribute to free enterprise, not even the corporate
people there. In all, it was a disgusting show.
conventional wisdom now is that multinational corporations are just
elaborate shell games covering every manner of criminality. The
recent talk is not about whether there should be new regulation
of business but how severe should it be.
recently, Pat Buchanan announced that the Enron collapse shows that
"capitalism may contain the seed of its own destruction."
That's a good summary of the Marxian view. Next he'll endorse a
dictatorship of the proletariat and the expropriation of the Kulaks.
To what extent was September 11 facilitated by domestic anti-capitalism,
namely, regulatory impositions?
This is an interesting case. Of course the FAA has long prevented
airlines from defending their own property. I know many pilots who
saw the need for guns on planes long ago. But the regulatory view
was that this was unthinkable. They were told that hijackers need
to be placated and talked to by experts on the ground, while passengers
and crew should be compliant.
is what all the terrorism experts were saying before September 11.
If you think about it, this entire war and the huge increase in
government power that has resulted, including the thousands dead
and the billions in destroyed property, might not ever have occurred
had the pilots had the right to protect property from invasion and
yes, regulators are to blame in part. Of course that doesn't remove
responsibility from the hijackers themselves. But let's say you
have a town council that forbids banks from installing alarm systems,
and then all the local banks are robbed. Should the town council
be held morally culpable along with the robbers? I think so.
is also the interesting case of asbestos and the WTC. Might the
steel in the building have weakened more slowly if asbestos had
been able to be used on the upper floor as it was on the lower?
Might that have given people more time to leave the buildings? Some
engineers have said so.
for restrictions on trade, those who support ongoing sanctions against
Iraq and other countries need to consider that these polices violate
free trade, and give rise to hatreds that can fuel terrorism. Long
before the terrorists cited these sanctions as an excuse, people
from groups like the Institute of International Economics had raised
serious questions about the effects of these sanctions. Remember
too that this is a region rich with oil profits made possible in
part by domestic restrictions on energy production. This is why
a policy of free trade with all peoples of the world needs to be
matched by loosened energy regulations at home.
Despite the devastation inflicted by socialism from Russia to Ethiopia
to Cuba, its apologists maintain these regimes have perverted socialist
principles. Is socialism inherently hostile to freedom? Is capitalism
a precondition for peace?
That's right, there's always a new form of socialism being proposed
in some new book. A bestseller on the college circuit called Empire,
for example, calls for a new communism which, the authors promise,
will be different from the old. But anything other than free enterprise
always means a society of compulsion and lower living standards,
and any form of socialism strictly enforced means dictatorship and
the total state. That this statement is still widely disputed only
illustrates the degree to which malignant fantasy can capture the
imagination of intellectuals.
the socialists hate most is that the masses have never risen up
to overthrow the free-enterprise society. This had already frustrated
them by the turn of the 20th century, so many of them
hatched a new scheme to impose socialism by crisis. In Europe, and
to some extent in the U.S., war was their preferred method of getting
rid of the market economy. They saw that war puts the government
in charge of economic life. They knew that if they ever stood a
chance to impose central planning, it was to be through war socialism.
is why the socialists and the left generally were such strong advocates
of entry into World War I, and why FDR so badly wanted to enter
World War II. Hitler too believed that war was the best way to bring
about national socialism. Mussolini felt the same about fascism.
Dictators love war. We even saw elements of this in the Clinton
years: he turned to war when his collectivist domestic programs
weren't panning out. And the left is correct in this: people are
more prone to give up liberty in wartime.
von Mises, who saw his country and civilization wrecked in two world
wars, used to say: "The first condition for the establishment
of perpetual peace is the general adoption of the principles of
laissez-faire capitalism." People on the left and right today
reject that view, and we live with the destructive aims and policies
of anti-capitalism, and we have perpetual war.
is why, so far as the Mises Institute is concerned, we will keep
doing what we have always done: defend the economics of capitalism
against its myriad enemies, because it is the very foundation of
peace, prosperity, and civilization, and the best, and perhaps only,
source of effective security as well.
Kantor [send him mail]
is a columnist for FrontPageMagazine.com and president of the
Center for Free Emigration,
which agrees with Frederick Douglass that “It is a fundamental truth
that every man is the rightful owner of his own body.”