Why Mises - And not hayek - ? - Hans - Hermann hoppe - Vienna - September 21, 2011
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bjbj Why Mises (and not Hayek)? Let me begin with a quote from an article that my old friend
Ralph Raico wrote some 15 years ago: Ludwig von Mises and F. A. Hayek are widely considered
the most eminent classical liberal thinkers of this century. They are also the two best
known Austrian economists. They were great scholars and great men. I was lucky to have
them both as my teachers. Yet it is clear that the world treats them very differently.
Mises was denied the Nobel Prize for economics, which Hayek won the year after Mises death.
Hayek is occasionally anthologized and read in college courses, when a spokesman for free
enterprise absolutely cannot be avoided; Mises is virtually unknown in American academia.
Even among organizations that support the free market in a general way, it is Hayek
who is honored and invoked, while Mises is ignored or pushed into the background. I want
to speculate and present a thesis why this is so and explain why I and I take it most
of us here take a very different view. Why I (and presumably you) are Misesians and not
Hayekians. My thesis is that Hayek s greater prominence has little if anything to do with
his economics. There is little difference in Mises and Hayek s economics. Indeed, most
economic ideas associated with Hayek were originated by Mises, and this fact alone would
make Mises rank far above Hayek as an economist. But most of today s professed Hayekians are
not trained economists. Few have actually read the books that are responsible for Hayek
s initial fame as an economist, i.e., his Monetary Theory and the Trade Cycle and his
Prices and Production. And I venture the guess that there exist no more than 10 people alive
today who have studied, from cover to cover, his Pure Theory of Capital. Rather, what explains
Hayek s greater prominence is Hayek s work, mostly in the second half of his professional
life, in the field of political philosophy and here, in this field, the difference between
Hayek and Mises is striking indeed. My thesis is essentially the same one also advanced
by my friend Ralph Raico: Hayek is not a classical liberal at all, or a Radikalliberaler as the
NZZ, as usual clueless, has just recently referred to him. Hayek is actually a moderate
social democrat, and since we live in the age of social democracy, this makes him a
respectable and responsible scholar. Hayek, as you may recall, dedicated his Road to Serfdom
to the socialists in all parties. And the socialists in all parties now pay him back
in using Hayek to present themselves as liberals. Now to the proof, and I rely for this mostly
on the Constitution of Liberty, and his three volume Law, Legislation and Liberty which
are generally regarded as Hayek s most important contributions to the field of political theory.
According to Hayek, government is necessary to fulfill the following tasks: Not merely
for law enforcement and defense against external enemies, but in an advanced society government
ought to use its power of raising funds by taxation to provide a number of services which
for various reasons cannot be provided, or cannot be provided adequately, by the market.
(Since at all times an infinite number of goods and services exist, which the market
does not provide, Hayek hands government a blank check.) Among these are: protection
against violence, epidemics, or such natural forces as floods and avalanches, but also
many of the amenities which make life in modern cities tolerable, most roads .the provision
of standards of measure, and of many kinds of information ranging from land registers,
maps and statistics to the certification of the quality of some goods or services offered
in the market. Additional government functions are the assurance of a certain minimum income
for everyone, government should distribute its expenditure over time in such a manner
that it will step in when private investment flags, it should finance schools and research
as well as enforce building regulations, pure food laws, the certification of certain professions,
the restrictions on the sale of certain dangerous goods (such as arms, explosives, poisons and
drugs), as well as some safety and health regulations for the processes of production
and the provision of such public institutions as theaters, sports grounds, etc., and it
should make use of the power of eminent domain to enhance the public good. Moreover, it generally
holds that there is some reason to believe that with the increase in general wealth and
of the density of population, the share of all needs that can be satisfied only by collective
action will continue to grow. Further, government should implement an extensive system of compulsory
insurance ( coercion intended to forestall greater coercion ), public, subsidized housing
is a possible government task, and likewise city planning and zoning are considered appropriate
government functions provided that the sum of the gains exceed the sum of the losses.
And lastly, the provision of amenities of or opportunities for recreation, or the preservation
of natural beauty or of historical sites or scientific interest . Natural parks, nature-reservations,
etc, are legitimate government tasks. In addition, Hayek insists we recognize that it is irrelevant
how big government is or if and how fast it grows. What alone is important is that government
actions fulfill certain formal requirements. It is the character rather than the volume
of government activity that is important. Taxes as such and the absolute height of taxation
are not a problem for Hayek. Taxes and likewise compulsory military service lose their character
as coercive measures, if they are at least predictable and are enforced irrespective
of how the individual would otherwise employ his energies; this deprives them largely of
the evil nature of coercion. If the known necessity of paying a certain amount of taxes
becomes the basis of all my plans, if a period of military service is a foreseeable part
of my career, then I can follow a general plan of life of my own making and am as independent
of the will of another person as men have learned to be in society. But please, it must
be a proportional tax and general military service! I could go on and on, citing Hayek
s muddled and contradictory definitions of freedom and coercion, but that shall suffice
to make my point. I am simply asking: what socialist and what green could have any difficulties
with all this? Following Hayek, they can all proudly call themselves liberals. In distinct
contrast: How refreshingly clear and very different is Mises! For him, the definition
of liberalism can be condensed in a single word: private property. The state, for Mises,
is legalized force, and its only function is to defend life and property by beating
anti-social elements into submission. As for the rest, government is the employment of
armed men, of policemen, gendarmes, soldiers, prison guards, and hangmen. The essential
feature of government is the enforcement of its decrees by beating, killing, and imprisonment.
Those who are asking for more government interference are asking ultimately for more compulsion
and less freedom. Moreover (and this is for those who have not read much of Mises but
invariably pipe up but even Mises is not an anarchist ): Certainly the younger Mises allows
for unlimited secession, down to the level of the individual, if one comes to the conclusion
that government is not doing what it is supposed to do: to protect life and property. And the
older Mises never repudiated this position. Mises, then, as my own intellectual master
Murray Rothbard noted, is a laissez-faire radical: an extremist. (And Hayek is a muddle
head and I like extremists, not muddle heads.) PAGE PAGE hD{d gdVP &`#$ gdVP gdVP gdVP gdVP
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