The Free Market 25, no. 1 (January 2007)
When I was about 18 years old I purchased my first bit of real estate. It was a four-family apartment house in the Sheepshead Bay neighborhood of Brooklyn, New York, right near the ocean. I thought that one day it would become quite valuable. It was rent controlled and the rents were extremely low, so I was able to purchase it from the proceeds of part-time and summer jobs, plus my Bar Mitzvah presents received on my 13th birthday, pretty much all of which I had saved. My next venture, a few years later was a 10-family house on East 84th Street between 2nd and 3rd Avenues, potentially a very high-rent district.
During the time I was studying for my Ph.D. degree at Columbia University, I was renting an apartment in a 24-suite building nearby, on 122nd Street, between Broadway and Amsterdam Avenue. Too close to Harlem to be considered a luxury area, it was the only building on the block not owned by the Jewish Theological Seminary, also located there. I soon purchased this one, too. Right before I left this business I was hot on the trail of an even bigger proposition: an 80-family building on Broadway in the 90s, right near where Murray Rothbard lived on West 88th Street. I had had success at each step of my real estate career, and was contemplating even further expansion.
Why did I quit? Because I went to sleep thinking about the roofing problem on the Brooklyn house; or the lady in apartment 2F who needed a new refrigerator; or the man in 4B whose toilet was leaking; or the plumbing in the house on 122nd Street. I simply didn’t want to concern myself with issues of this sort. I was a landlord only as a means toward the end of amassing wealth. I didn’t enjoy any of it for its own sake.
Instead, I wanted to be contemplating such issues as the role of government; what was all this about Austrian economics that I was reading for the first time; could the oceans really be privatized? I was in the midst of writing essays that would eventually become the chapters of Defending the Undefendable, and all these topics were more and more coming to intrigue me. Intrigue me? No. It was much more serious. I would now say in looking back that I was devastated at having to spend virtually any time on anything else.
So why don’t I want to recommend the business path to the best of my students, the ones who have seriously been bitten by the beauty of Austro-libertarianism, as I was all those years ago? Because I do not think they will be happy contemplating price differentials in currencies, except insofar as these thoughts can help them get to the bottom of, and make the case for, the gold standard or free-market money. I don’t think these kids will be fulfilled by digging into the essence of interest rates, only to earn money in futures markets.
In short, I think they will be deliriously happy, as I then was and now still am, to thereby in this way improve upon or better promote or defend against critics, the Austrian business cycle theory, for example. If my students are interested in real estate, better to write the best new case against rent control, or public housing, or zoning, rather than to worry about scores of tenants in buildings they are managing, and the problems they are having with roofs, plumbing, heating or air-conditioning.
Don’t get me wrong. As an advocate of the free society, I full well realize that we cannot have an economy at all, let alone a civilized one, if no one, to quote a phrase, “takes care of business.” I stand second to no one in my appreciation of what those who pursue commercial endeavors do for our society.
Further, I think that of all the academics associated with the Mises Institute, I am amongst those most appreciative of the role played by its financial supporters from the world of business and entrepreneurship. Without them, the edifice, the necessary capital equipment, simply would not be there.
But still, this does not imply that for those of my students who are on the fence concerning careers in business versus full-time professional efforts to promote liberty, I should push them in the former direction. I very much favor the latter course of action, for, as important as is business, those of us who strive mightily to ensure that businessmen are allowed to freely engage in commerce also make a crucial contribution.
Here is a second reason for this stance of mine. For every ten students I inspire, encourage, cajole or, OK, OK, nag to take up a life of the intellectual, oh, five to seven of them might succeed. However, I think I would be very lucky indeed with a one-in-ten success rate in the other direction. That is, for these kids to not only be successful in business, but to also keep that white hot appreciation of economic liberty burning over the many decades necessary for them to have enough money to contribute significantly to groups such as the Mises Institute. Why? Because just about everything they do in an academic field (certainly including journalism, working as a free-market think tank analyst, etc.) will further buttress their beliefs, and encourage them in their libertarianism.
To be sure, we are not talking anything like 100 percent here. As a professor, there are still exams to be graded, committee meetings to attend, etc. But, in contrast, almost nothing in the business world promotes the ideas of liberty, apart from exemplifying it, as does all marketplace activity. They will be concerned about the IRS, or the regulatory bureau, or staying one step ahead of their competitors, or satisfying consumers, or with paying off housing inspectors, or with building a better mouse (of the Disney or computer variety) or mousetrap. I think it is the rare young person, the very rare one, who can keep within him burning the flame of liberty after decades of this sort of thing.
It would be interesting to conduct a survey amongst the present donors of the Mises Institute: how many of them were fervent libertarians as young people, and kept this “fire in their belly” going strong for decades while working in the business community? How many were, instead, “born again”: later in life, after much success in commerce, they came to realize the contribution to civilization of this organization? I suspect that the latter will predominate.
What about doing both? That is, having careers both as an intellectual and as a businessman? I know of only a mere handful of cases where people have made important contributions in these two very different fields. This must be the overwhelming exception, not the general rule. This is due to the power of specialization and the division of labor. How many professional tennis players are also world-class violinists? How many really good movie actors are physicians? Even Michael Jordan, perhaps the best basketball player who ever dunked a ball, was a total failure at baseball, a not completely unrelated enterprise.
So I shall continue to refer those of my very best students who are interested in promoting liberty and Austrian economics on a full-time professional basis to do just that. If there is one thing I am passionate about, it is passing on to the next generation the baton that Murray Rothbard a while ago passed on to me and my contemporaries.
