June 23, Hans Sennholz died at the age of 85. He was one of four
men who earned his Ph.D. in economics under Ludwig von Mises at
New York University. (The others were George Riesman, Israel Kirzner,
and Louis Spadaro.) Earlier this year, he wrote an article for Lewrockwell.com
on the influence Mises had on him, which was enormous. Unlike the
other three, he arrived in class with a doctorate in political science,
earned at Kln.
In a collection
of essays written in honor of Sennholz when he retired from full-time
teaching at age 70, A Man of Principle (Grove City College,
1992), I wrote of his influence as a transmitter of Mises’ economics
to a younger generation: mine. I stressed the fact that for 37 years,
he had served as the chairman of the economics department at Grove
City College. He taught undergraduates at a Presbyterian four-year
college whose name sounded like a community college.
College was the perfect school for Sennholz. Its primary donor was
oil magnate J. Howard Pew, who recommended that Sennholz be hired
in 1955. Throughout the twentieth century, Pew’s Sun Oil Company
had withstood competition from Rockefeller’s oil companies and had
prospered. Pew was a dedicated Presbyterian layman who was happy
to have Lutheran Sennholz run the economics department. Pew also
provided the funding for Christian Economics, a fortnightly
tabloid sent out to every Protestant minister in the country free
of charge. Sennholz often wrote for it.
except in approximately two-dozen elite private colleges, is regarded
by the academic guild as drudgery that is justifiable only because
it is the required path to teaching graduate students. As for teaching
introductory, lower division courses, this is a task assigned to
untenured assistant professors, who have a team of graduate students
to grade the exams, grade the term papers (if any), and lead the
discussion groups. Not at Grove City College. Sennholz always took
his turn teaching the introductory economics course, as did every
member of the department, none of whom was ever granted tenure.
College did not grant tenure to anyone, and when the school fired
a professor in 1962, the American Association of University Professors
censored the college. That censure remains in force. The effect on Grove City College’s
reputation was so negligible — invisible, in fact — that
the AAUP has had a major problem for over four decades: how to explain
the organization’s utter impotence. Grove City College was Sennholz’s
kind of place.
to teaching four classes every term, Sennholz also wrote. The volume
of his output was legendary by 1990. He wrote for The Freeman,
American Opinion, and dozens of other free market publications.
He wrote over 500 articles, plus 17 books.
Yet he was unknown by the economics guild. He did not publish in
the unread and generally unreadable professional journals that serve
as the career stepping-stones to tenure at the major universities.
In the fall
of 1955, when Sennholz arrived at Grove City College, the dominant
school of economic thought in America was Keynesianism, which placed
the state at the center of the economy as the great reconciler of
individuals’ plans. The Keynesians taught that government officials,
operating with the support of other government officials with guns,
alone can bring economic stability to a capitalist economy.
only academic rivals — just barely — in the free market camp in
1955 were Chicago School economists, who taught that fewer government
officials, operating with the support of economists with a government-licensed
printing press, alone can bring economic stability to a capitalist
both positions. Extending the insight of Mises’ 1920 essay on the impossibility
of rational economic calculation in a socialist economy, Sennholz
denied the possibility of socially rational intervention by government
planners, whether they coerce people through taxation, regulation,
or counterfeiting. He defended the freedom of contract, the gold
coin standard, the abolition of the Federal Reserve System, and
the de-funding of the welfare state.
He was isolated.
He was isolated geographically: Western Pennsylvania. He was isolated
institutionally: an undergraduate college. Most of all, he was isolated
methodologically. He taught unadulterated Austrian economics. His
students were not required to run the gauntlet of Keynesian and
Chicago School equations, all based on the concept of equilibrium,
a concept imported from physics. Mises’ epistemology denied the
theoretical basis of equilibrium, namely, the omniscience of mankind.
Without the assumption of omniscience, the conditions required to
establish equilibrium do not exist.
There are no
profits or losses under equilibrium, for both stem from the effects
of men’s attempt to deal with uncertainty regarding the future.
Sennholz, following Mises, placed the profit-and-loss system as
the operational command post of the free market. The entrepreneur
is the person who puts his own money and reputation on the line
in his own plans to overcome future uncertainty. He seeks ways to
help buyers and sellers reconcile their plans.
familiar with Austrian economics, it seems beyond belief that economics
could be taught apart from the methodological assumption of universal
uncertainty. But it is. Everywhere. Still.
He stood almost
alone in academia in 1955, and he remained alone in undergraduate
education until the mid-1970’s, when the visible failure of Keynesianism
to overcome rising unemployment and price inflation, coupled with
Hayek’s winning of the Nobel Prize in 1974, helped to launch a revival
of Austrian economics. We live in the midst of that revival.
Read, who founded the Foundation for Economic Education (FEE) in
1946, and who hired as his secretary the woman who would later marry
Sennholz, had one supreme word of praise for someone: “He doesn’t
leak.” Hans Sennholz did not leak. He did not, as Read once put
it, sink in a sea of “buts.” He defended free market principles
in every area of life throughout his career. At the age of 70, he
took over FEE and brought it back from an ocean of red ink.
He served as FEE’s president for five years.
He was never
a man to let a bad argument pass unchallenged. He would begin his
refutation with this phrase: “Wait a minute.” The listener could
be sure of one thing: it would take more than a minute.
In the final
years, he went on-line: www.sennholz.com.
There, he published detailed and lively essays that were as insightful
as any that he had written three or four decades earlier. In his
view, the Web was another tool to be used to communicate his message.
He mastered this tool.
was still on duty when he died.
He was my academic
role model for over 40 years: “Just keep writing!” You could do
write his biography — someone with the skills of Leonard Read’s
biographer, or J. Howard Pew’s: Mary Sennholz, his wife. I just
cannot imagine anyone else writing it.