A Student of Mises and Rand

The following story is part of Walter Block’s Autobiography Archive.

by George Reisman

Walter Block has kindly invited me to contribute an autobiographical essay featuring the early development of my ideas on politics and economics. What follows is an adaptation of portions of the Preface to my book Capitalism: A Treatise on Economics (Ottawa, Illinois: Jameson Books, 1996), which describes the influences Professor Block has in mind.

I have had practically a lifetime of concern for the protection of property rights and for the right of individuals personally and selfishly to enjoy all the prosperity they can peacefully achieve.

I remember identifying as a boy of no more than ten or eleven years of age that what the tenants and city government of New York, which is where I then lived, were doing with the property of the landlords of that city, by means of rent control, was exactly the same in principle as what schoolyard bullies often did with my baseball or football — namely, seize it against the will of its owner and arbitrarily use it for their own pleasure, without a thought for the rights of the owner, mine or the landlords’.

From that early age, I was very much aware of a widespread contempt and hostility toward property rights and property owners — a contempt and hostility manifested in such comments as the one I heard a little later from a junior high school teacher that she did not care about the fact that there were people paying ninety percent of their incomes in taxes (which was then the maximum federal surtax rate), "because they still had a lot left." When I encountered the same attitude of contemptuous philosophic indifference to the violation of property rights in one of my own close relatives, I came to the conclusion that property rights were very much in need of defense, and that I must write a book on their behalf. I actually set out to write such a book at the time, and succeeded in putting together about one or two paragraphs.

It was clear to me that such contemptuous attitudes and the violations of property rights that they supported were contrary to everything that the Declaration of Independence and Constitution of the United States stood for, which above all was the right of the individual to the pursuit of his own happiness, which included his material prosperity and enjoyment of same. Indeed, my first serious professional ambition, which I held around the age of twelve, was to become a Constitutional lawyer, so that I might best defend that right.

Until the age of eleven or twelve, I took for granted that practically every American recognized the value of his country because he loved its freedom and supported the principles on which the United States was based. Based on my reading of editorials and columnists in the Hearst Press, then represented in New York by The Daily Mirror and the Journal American, I thought that now that the Nazis had been defeated, the only exceptions were a handful of communist or socialist crackpots.

My cheerful confidence in the popularity of individual freedom began to erode when I reached junior high school. There, after a few months’ attendance, I came to the conclusion that a disproportionate number of the communist and socialist crackpots I had read about were to be found among my teachers. I encountered teachers who openly confessed to being socialists, including one who regretted that he lived just inside the border of a conservative Republican’s congressional district because if he lived across the street he could have voted for Representative Vito Marcantonio, then the most far-leftwing member of Congress. The same man described the Soviet Union as a great experiment. He and his colleagues dismissed questions that challenged any of their interpretations by referring to the presumed size of the bank account or stock portfolio of the questioner’s father. I clearly remember this man’s response to what I thought was an astonishing fact that all by itself proved the value of the United States and what it stood for, a fact which I happily conveyed to my classmates in the seventh grade in an oral report, and which I had learned from a motion-picture documentary shortly before. This was the fact that with only six percent of the world’s population, the United States produced fully forty percent of the world’s annual output of goods and services. The man’s reply was yes, but so what; ten percent of the country’s population owned ninety percent of its wealth.

I soon realized that no one I knew, neither other students, nor any of the adults I knew, was able to answer the leftwing arguments I was encountering daily at school. For a time, I thought, the explanation was that this was New York City. The people here have been intellectually corrupted. But the rest of the country is still full of people who support the principles of individual rights and freedom and know how to defend them. Over the next two summers, I learned that the problem was nationwide. I made this discovery as the result of my experiences at a vacation camp in Maine, where I met a wide variety of college students from all over the country who were working as camp counselors, as well as occasional local citizens. The college students too included a goodly proportion of self-confessed "social democrats." I remember one of them telling me with obvious contempt how ignorant the parents of many of the campers were. They had been to see a local production of a play by George Bernard Shaw that made their type of people its targets, and they all loved it.

I saw that virtually all of the arguments against property rights were of an economic nature. I undertook the study of economics for the explicit purpose of finding economic arguments in defense of property rights. In my first year of study, with the aid of a dictionary by my side, I read substantial portions of Adam Smith’s The Wealth of Nations and David Ricardo’s Principles of Political Economy and Taxation, as well as the whole of a book on the history of economic thought. I started with Smith and Ricardo in the belief that their books would provide the arguments I was seeking, for they had the reputation of having been the leading defenders of capitalism in the system’s heyday. Although my mature evaluation of them is that they do in fact have some very important things to say in the defense of capitalism, I was greatly disappointed in them at the time, because it seemed to me that with their support for the labor theory of value, they served merely to prepare the ground for Marx. (Concerning the errors of this view, see Capitalism, pp. 473–500.) None of the other authors described in the book I read on the history of economic thought appeared to offer any serious arguments in defense of capitalism.

At the age of fourteen, I discovered William Stanley Jevons’s The State in Relation to Labour and The Theory of Political Economy.

During this period, I had come to subscribe to a fortnightly magazine called The Freeman. At that time, Henry Hazlitt played a major role in writing the magazine’s editorials and in determining its content. So long as he continued in that role, I found the magazine so valuable that I read every issue from cover to cover.

It was in one of the early issues of The Freeman that I had my first exposure to the writings of Ludwig von Mises. It was his essay "Lord Keynes and Say’s Law." From reading the essay, I could see that Mises knew the history of economic thought and that he was presenting a strong, self-assured position in defense of an important and relatively complicated aspect of the functioning of capitalism, a position that Say and Ricardo had taken in the early nineteenth century, which was that general business depressions could never be caused by any so-called excess of production. I knew immediately that here was a man I must read further. And, a few months later, at the age of fourteen, I borrowed his classic Socialism from the public library. Unfortunately, the book was then beyond me and I was not able to gain very much from the parts I attempted to read. But less than a year later, with some of the money I had been given on my fifteenth birthday, I bought Socialism and over the coming months had one of the very greatest intellectual experiences of my life, before or since. In the intervening months since my previous attempt, my mental powers must have grown the intellectual equivalent of the several inches that boys of that age are capable of growing in such a short time, because I was now able to understand a very great deal of what I read. And what I read filled me with a sense of utter enlightenment.

The astonishing ideas I found in Socialism were amplified and additional major arguments were added to them in Mises's other writings then available in English, above all, Human Action and The Theory of Money and Credit, as well as Planning For Freedom, Bureaucracy, and Omnipotent Government, all of which I read over the next three years.

Mises was clearly the man whose writings I had been searching for. Here at last was a great, articulate defender of the economic institutions of capitalism, who wrote with all the power that logical argument could provide and with the authority of the highest level of scholarship.

One of the great good fortunes of my life, that profoundly contributed to my subsequent intellectual development, was to be invited by von Mises to attend his graduate seminar at New York University. I received this invitation shortly after my sixteenth birthday, in the last part of my senior year in high school. It came about as the result of a meeting, arranged by The Foundation for Economic Education, between Mises, myself, and Ralph Raico, who was then a fellow student of mine at the Bronx High School of Science. After several hours of conversation, spent mainly answering our questions, Mises invited us both to come to his seminar — provided (in reference to our extreme youth) that we did "not make noise." We both eagerly accepted his invitation and began attending the very next week.

The format of the seminar was that each semester it was devoted to some topic of special current interest to von Mises, such as inflation or the epistemology of economics. It would open each evening with Mises himself speaking from a few notes for about twenty minutes to half an hour, followed by a general, cross discussion among the various seminar members who wished to participate or who Mises occasionally called upon. Often, a portion of the discussion was devoted to some paper that a seminar participant had prepared for the occasion.

I regularly attended the seminar for about seven and a half years, through the remainder of high school, all through my college years at Columbia University, and then as an enrolled student in NYU’s Graduate School of Business Administration, which was where Mises taught. I stopped attending only when I myself began to teach and had a class of my own to conduct on Thursday evenings.

At the seminar, I had the opportunity of hearing many observations by Mises that were not in his books that I had read. Equally important, I had the opportunity of asking him questions. Uncharacteristically, I did not raise any questions until after I had been in attendance for about a year and a half. Thereafter, I became a full-fledged participant, often being assigned papers to write and deliver.

My most outstanding memory of the seminar is that of Mises himself. I always experienced a heightened level of awareness when he entered the room and took his seat at the seminar table. What I was acutely aware of was that here, just a few feet away from me, was one of the outstanding thinkers in all of human history.

One of the things Mises stressed in his seminar was the importance of knowing foreign languages. One of the reasons he gave for this was the frequent inadequacy of translation. In this connection, I was very surprised to learn that he was unhappy with the translation of Socialism.

I accepted his injunction to learn foreign languages because there were important writings of his own not yet translated, as well as important writings of Menger and Böhm-Bawerk, his predecessors in the Austrian school. The result was that in the Christmas vacation of my sophomore year, I dared to translate a chapter of his Grundprobleme der Nationalökonomie (Epistemological Problems of Economics) and then show it to him. Although he had some misgivings, he supported my application for a grant from the William Volker Fund to translate the remainder of the book over the following summer. I obtained the grant and accomplished the translation the next summer.

I know that both he and the Volker Fund were very favorably impressed, because he urged me to translate Heinrich Rickert’s Kulturwissenschaft und Naturwissenschaft, which he considered a major answer to logical positivism, over the next summer, and, when I applied for a grant to do it, I got an immediate favorable response. Both translations were published a few years later by D. Van Nostrand, the latter under the title Science and History.

I have to say that translating Mises, and being well paid to do it at that, was absolutely the most fabulous thing I could think of doing at the time, and to this day, I count it as a major accomplishment of my life.

Some of the credit for my having had the courage to start the translation belongs to the late Murray Rothbard, whom I met when I entered the seminar and became close friends with over the next five years. (Other members of the seminar when I arrived on the scene were Hans Sennholz and his wife Mary; Israel Kirzner; Professor William H. Peterson, then of New York University, and his wife Mary; and Percy Greaves, who later wrote Understanding the Dollar Crisis, and his wife Bettina Bien Greaves, then a staff member of the Foundation for Economic Education. Prominent more or less frequent visitors to the seminar were Henry Hazlitt, then a regular columnist for Newsweek as well as the author of numerous books, the best known of which, of course, is Economics in One Lesson, and Lawrence Fertig, who at the time was a columnist for the New York World Telegram and Sun.) Rothbard was then working on his Man, Economy, and State on a grant from the Volker Fund and urged me to apply, assuring me that a proposal to translate Grundprobleme would be considered both seriously and sympathetically.

By the time I had been in the seminar for about a year, Rothbard, Raico, and I, were joined by Robert Hessen and Leonard Liggio. About a year after that, Ronald Hamowy also joined us. We almost always continued the discussions of the seminar until past midnight, usually at Rothbard’s apartment, and frequently met on weekends. We informally called ourselves "The Circle Bastiat," after the leading nineteenth-century French advocate of capitalism, Frederic Bastiat.

At one of our gatherings, in the summer of 1954, over three years before the publication of Atlas Shrugged, Rothbard brought up the name Ayn Rand, whom I had not previously heard of. He described her as an extremely interesting person and, when he observed the curiosity of our whole group, asked if we would be interested in meeting her. Everyone in the group was very much interested. He then proceeded to arrange a meeting for the second Saturday night in July, at her apartment in midtown Manhattan.

That meeting, and the next one a week later, had an unforgettable effect on me. In the year or more before I entered Ayn Rand’s apartment, I held three explicitly formulated leading intellectual values: liberalism (in the sense in which Mises used the term, and which actually meant capitalism); utilitarianism, which was my philosophy of ethics and which I had learned largely from Mises (though not entirely, inasmuch as I had already come to the conclusion on my own that everything a person does is selfish insofar as it seeks to achieve his ends, a conclusion that I now consider to be mistaken, because it attaches no objective meaning to the concept of self); and "McCarthyism," which I was enthusiastically for, because I believed that the country was heavily infested with communists and socialists, whom I detested, and to whom Senator McCarthy was causing a major amount of upset. By the time I left Ayn Rand’s apartment, even after the first meeting, I was seriously shaken in my attachment to utilitarianism.

Both meetings began at about 8:30 in the evening and lasted until about five o’clock the following morning. When I was introduced to her, I had no real idea of her intellectual caliber. I quickly began to learn her estimate of herself, however, when I offered her two tickets to an upcoming dinner in honor of Roy Cohn, Senator McCarthy’s chief aide, at which Senator McCarthy would be present. (I was scheduled to make a brief speech at the event, and when I mentioned to one of the event’s organizers that I was going to meet Ayn Rand, she asked me to extend the invitation.) Miss Rand declined the invitation on the grounds that to get involved as she would need to get involved, she would have to drop her present project (which was the writing of Atlas Shrugged) and do for McCarthy what Zola had done for Dreyfus. I had seen the Paul Muni movie Zola, and so had a good idea of Zola’s stature. I don’t quite remember how I experienced the comparison, but it was probably something comparable to the expression of a silent whistle. (After I came to appreciate the nature of Ayn Rand’s accomplishments, a comparison to Zola would seem several orders of magnitude too modest.)

At both meetings, most of the time was taken up with my arguing with Ayn Rand about whether values were subjective or objective, while Rothbard, as he himself later described it, looked on with amusement, watching me raise all the same questions and objections he had raised on some previous occasion, equally to no avail.

I had a sense of amazement at both meetings. I was amazed that I was involved in an argument that in the beginning seemed absolutely open and shut to me, and yet that I could not win. I was amazed that my opponent was expressing views that I found both utterly naïve and at the same time was incapable of answering without being driven to support positions that I did not want to support, and that I was repeatedly being driven into supporting such positions.

Neither of the evenings was very pleasant. At one point — I don’t know how we got to the subject, nor whether it occurred at our first or second meeting — I expressed the conviction that a void must exist. Otherwise, I did not see how the existence of motion was possible, since two objects could not occupy the same place at the same time. Ayn Rand’s reply to my expression of my conviction was that "it was worse than anything a communist could have said." (In retrospect, recognizing that the starting point of her philosophy is that "existence exists," I realize she took my statement to mean that I upheld the existence of "nonexistence" and was thus maintaining the worst possible contradiction.)

Because of such unpleasantness, I did not desire to see her again until after I read Atlas Shrugged. However, I could not forget our meetings and could not help wondering if somehow she might be right that values really were objective after all. I was very troubled by the implications of the proposition that all values are ultimately arbitrary and subjective, as Mises claimed. It no longer seemed enough that the great majority of people happened to prefer life to death, and health and wealth to sickness and poverty. For if they happened not to, there would be nothing to say to them that could change their minds, and if there were enough of them, no way to fight them, and, worst of all, no way even morally to condemn any slaughters they might commit, because if all values really were arbitrary and subjective, a concentration-camp sadist’s values would be as good and as moral as the values of the world’s greatest creators.

The years between my first meetings with Ayn Rand and the publication of Atlas Shrugged spanned my sophomore through senior years in college. In that time, I experienced serious intellectual doubt in connection with my ability to defend capitalism. What I had learned from Mises enabled me decisively to answer practically every argument that had been raised against capitalism prior to 1930, which was more than enough to answer my high school teachers. But my college professors presented a different challenge. They were teaching Keynesianism and the doctrine of pure and perfect competition/imperfect competition. Mises, I reluctantly had to conclude, had not dealt adequately with these doctrines. (This conclusion may appear somewhat ironic in view of the fact that what is today accepted as a new and convincing major critique of Keynesianism, namely, the "rational expectations doctrine," is nothing more than arguments made by Mises and Hazlitt in the 1950s, for which they have received no credit.) At any rate, these were two major areas in which I found myself unable to turn to his writings for the kind of decisive help I had come to expect from him.

The doubts I experienced in college were not in response to any kind of solid arguments, but more in response to phantoms of arguments that could not be grasped in any clear, precise way and that in fact usually bore obvious absurdities. This last was certainly true of the Keynesian multiplier doctrine and of the claim on the part of the pure-and-perfect competition doctrine that competition implied the absence of rivalry. Despite the absurdities, all of the faculty and practically all of my fellow students at Columbia seemed perfectly at home with the doctrines and absolutely confident of their truth.

If any one concrete can convey the intellectual dishonesty of Columbia’s economics department in those days, it was this. Namely, while neglecting to provide a single copy of any of the writings of von Mises, or even so much as mention the existence of any of them in any of the assigned readings or, as far as I was aware, in a classroom, the department saw to it that literally dozens of copies of Oskar Lange’s attempted refutation of Mises’s doctrine on the impossibility of economic calculation under socialism were available on open reserve in the library — as an optional, supplementary reading in the introductory economics course.

Economics was not the only area in college in which I experienced revulsion for Columbia’s teachings. I had the same experience in the so-called contemporary civilization courses I had to take, and in history courses.

I do not know if my college education could have damaged my intellectual development permanently. It did not have the chance. For just a few months after graduation, Atlas Shrugged appeared.

I obtained a very early copy and began to read it almost immediately. Once I started it, I could not put it down, except for such necessary things as eating and sleeping. I was simply pulled along by what I have thought of ever since as the most exciting plot-novel ever written. Every two hundred pages or so, the story reached a new level of intensity, making it even more demanding of resolution than it was before. I stopped only when I finally finished the book, four days after I had started it. When I finished, the only thing I could find to say in criticism, tongue in cheek, was that the book was too short and the villains were not black enough.

The first thing I got out of Atlas Shrugged and the philosophical system it presented was a powerful reinforcement of my conviction that my basic ideas were right and a renewal of my confidence that I would be able to expose my professors’ errors.

Very soon thereafter, the whole Circle Bastiat, myself included, met again with Ayn Rand. We were all tremendously enthusiastic over Atlas. Rothbard wrote Ayn Rand a letter, in which, I believe, he compared her to the sun, which one cannot approach too closely. I truly thought that Atlas Shrugged would convert the country — in about six weeks; I could not understand how anyone could read it without being either convinced by what it had to say or else hospitalized by a mental breakdown.

The following winter, Rothbard, Raico, and I, and, I think, Bob Hessen, all enrolled in the very first lecture course ever delivered on Objectivism. This was before Objectivism even had the name "Objectivism" and was still described simply as "the philosophy of Ayn Rand." Nevertheless, by the summer of that same year, 1958, tensions had begun to develop between Rothbard and Ayn Rand, which led to a shattering of relationships, including my friendship with him. (When I knew Rothbard, he was a staunch pro-McCarthy, anticommunist. In fact it was he who wrote the speech I delivered at the previously mentioned dinner for Roy Cohn. Later on, incredible as it may seem, he came to hold that the United States was the aggressor against Soviet Russia in the so-called cold war — see his For a New Liberty [New York: Macmillan, 1973], p. 287, 294.)

Shortly after that break, I took Rothbard’s place in making a presentation in Ayn Rand’s living room of the case for "competing governments," i.e., the purchase and sale even of such government services as police, courts, and military in a free market. As the result of Ayn Rand’s criticisms, I came to the conclusion that the case was untenable, if for no other reason than that it abandoned the distinction between private action and government action and implicitly urged unregulated, uncontrolled government action, i.e., the uncontrolled, unregulated use of physical force. This was the logical implication of treating government as a free business enterprise. I had to conclude that government in the form of a highly regulated, tightly controlled legal monopoly on the use of force, was necessary after all, in order to provide an essential foundation for unregulated, uncontrolled private markets in all goods and services, which would then function totally free of the threat of physical force. This indeed, represented nothing more than a return to my starting point. It was what the government established by the United States’ Constitution had represented, and which I had so much admired.

At that time, and in later years, I came to be influenced by Ayn Rand’s ideas in numerous ways, thanks in part to the fact that over the years between 1957 and her death in 1982, I had the opportunity of frequently meeting with her and speaking with her extensively about her writings. The influence of her philosophy extolling individual rights and the value of human life and reason appears repeatedly in my book and in numerous ways sets its intellectual tone.

The year and a half or more following my abandonment of the doctrine of competing governments turned out to be the most intellectually productive of my life, and to provide most of what is original in my book.

By this time, I had already completed all of the course work for a Ph.D., but I still had the written and oral exams and the dissertation in front of me. My original plan had been to go straight through for the Ph.D., in the shortest possible time. Now I found the prospect of the obstacles that still remained to be somewhat more daunting, and so I decided that it would be worthwhile to take a few months out and obtain an MBA degree. For this, all I needed to do was write an MBA thesis.

I decided to choose a topic that would require that I read only "good people" — i.e., sound authors. I had come to the conclusion that because the efforts of proto-Keynesians, such as Malthus and Sismondi, had been decisively defeated by the classical economists in the early nineteenth century, and because nothing like the pure-and-perfect-competition doctrine had ever even arisen in the nineteenth century, when classical economics was in vogue, there must have been something in classical economics that served to refute or thoroughly preclude such doctrines in the first place, and thus that I should turn to it once again as a source of knowledge. The thesis topic I chose was The Classical Economists and the Austrians on Value and Costs. This topic required that I read extensively in Menger, Böhm-Bawerk, and Wieser for the Austrian views, and not only in Smith and Ricardo, but also in James Mill, Say, McCulloch, Senior, and J.S. Mill, for the views of classical economics.

This project turned out to be a very good idea, indeed. I learned much more about the doctrine of diminishing marginal utility, including how it subsumes cases in which prices are actually determined in the first instance by cost of production. (On this point, see the lengthy quotation from Böhm-Bawerk on pp. 414–416 of my book and see also my translation of Böhm-Bawerk's "Value, Cost and Marginal Utility" and my notes on the translation, both of which appear in the Fall 2002 issue of the Quarterly Journal of Austrian Economics.) In reading seven different classical authors, each one covering essentially the same ground, and doing so at the age of twenty-one and twenty-two, instead of thirteen, I was able to come to a genuine understanding of their work, including the profound differences between their views and those of Marx, which are typically ignored.

What I gained from the extensive reading I had done in connection with my thesis went far beyond the subject of value and costs. In the months immediately following, I knew that I had learned a great deal that had not gone into the thesis — knowledge that I could then not yet even explicitly formulate. I felt good about my state of mind and I am pretty sure that I described my mental condition to myself as one of being "intellectually pregnant."

Back in the spring of 1958, I had succeeded in formulating to my own satisfaction a set of conditions in which capital accumulation could take place indefinitely with no accompanying fall in the rate of profit. I had tried to explain it to Rothbard, but without success. That demonstration was one element in the back of my mind, before I even got to the reading for my thesis. My exposure to principles of actual business accounting, as the result of having taken a number of courses on investments and corporation finance in the NYU program, provided another critical element besides what I had learned from my reading.

In July of 1959, it all came together. The precipitating event was my reading an extensive quotation from John Stuart Mill presenting the proposition that "demand for commodities is not demand for labour." This was a passage I had not read before. It appeared in Henry Hazlitt’s newly published The Failure of the "New Economics."

Very soon thereafter, I had a period of five successive days in which I was able to make one connection after another and to answer one question after another from a list I had compiled. In essence, I had put together, and was able to hold in my mind all at the same time, an early version of what now appears in my book as Figures 16-2 and 17-1 and derive a succession of major implications from it.

As I made the new connections I wrote them down, sometimes jumping out of bed to do so, lest I forget any of them. After the first five days, I had accumulated about 15 pages of notes, the most important part of which was an elaborate numerical example of the most essential points in a form consistent with the principles of business accounting. In August, I wrote a hundred-page-plus typed paper called "The Consumption Theory of Interest," which I showed to Henry Hazlitt. He was generally impressed with it, and, starting with the third printing of The Failure of the "New Economics," credited me with an important application I had made in the paper identifying a simultaneous breakdown of the Keynesian doctrines on consumption, employment, liquidity preference, and the rate of interest, though he did not refer to my manuscript specifically. (See Henry Hazlitt, The Failure of the "New Economics," p. 196, n. 6.)

Not long after I made my discoveries, I decided that they should be the main subject of my doctoral dissertation, which I began to do research for soon after passing my oral examination in the spring of 1960. For the sake of thoroughness, I wanted to include not only my own views, but also a critical analysis of all significant alternative views. I set out to follow the example of Böhm-Bawerk, who had done just that. Thus, in preparation for writing my dissertation, I read virtually all of Böhm-Bawerk that I had not previously read, as well as major selections from other authors whose views concerning the rate of profit/interest were prominent, such as Irving Fisher, Knut Wicksell, and Frank Fetter, as well as Smith, Ricardo, other classical economists, and Marx and Keynes.

I began writing the dissertation in May of 1961 and handed in a 625-page typed manuscript in the fall of 1962. The title was The Theory of Originary Interest. (At this time, I still followed Mises in describing what businessmen and accountants normally describe as profit, and which I too now refer to as profit, as "originary interest.")

In January of 1963, I learned that one of the members of my reading committee had rejected the dissertation. In order to gain his approval, it was necessary for me to eliminate well over half of the manuscript I had submitted, and write approximately thirty new pages at the beginning and thirty more new pages at the end. (On my own initiative, I replaced "originary interest" with "profit" throughout.) The last time I spoke with this committee member, he said he liked the new version much better than the original one, except for the first thirty pages; he also said he had not yet read the last thirty pages. (Sometime later, I was told that this individual had left the university to write editorials for The Washington Post.) My dissertation, as finally approved, carries the title The Theory of Aggregate Profit and the Average Rate of Profit.

This situation constituted the one time in my life when I was seriously disappointed in von Mises. He told me that he found it amusing that I should receive such trouble from this particular committee member, whom he regarded as a Marxist, when what I was providing was a modernized, more scientific version of the very ideas that were the foundation of the man’s own beliefs. Mises believed that because of my resurrection of the classical economists, I was indirectly resurrecting Marx. Happily, he changed his mind on this subject two years later, after hearing my lecture "A Ricardian’s Critique of the Exploitation Theory." (The substance of this lecture was published many years later as my essay "Classical Economics Versus the Exploitation Theory" in The Political Economy of Freedom Essays in Honor of F. A. Hayek [Munich and Vienna: Philosophia Verlag, 1985]. The same analysis, greatly elaborated, appears in Chapter 11 of my book. But the same essential material had been available to him in my original dissertation.)

Looking back over the past and all that has led to the writing of my book, I cannot help but take the greatest possible pride and satisfaction in the fact that along the way, in having been the student of both Ludwig von Mises and Ayn Rand, I was able to acquire what by my own standards at least is the highest possible "intellectual pedigree" that it is possible for any thinker to have acquired in my lifetime, or, indeed, in any other lifetime. I can only hope that if they were alive, they would look favorably upon what I have attempted to build on the foundations they gave me.