In the last two weeks, I’ve heard some people comment that this is a difficult time to be a libertarian. I disagree. The events of September 11 and its aftermath only reinforce the case for a free society, a point to which I will return shortly. What is difficult is to defend freedom and peace when everyone around you is crying out for unprecedented statism, central planning, and ever more bloodshed. Indeed, many public intellectuals, backed by the enormous megaphone of the mass media and the immense power of the State, have used the occasion of the attack to call effectively for the end of freedom itself.
The chorus went like this. The reality of September 11 suggests that there are some values, namely security and unity, that are more important than liberty and rights. Our predilection for liberty presupposes that people are basically well intentioned. Because we have come face to face with evil, an evil from which only public authority can protect us, we must now recognize that our attachment to liberty is anachronistic, even dangerous, even life threatening.
Consider Francis Fukuyama’s comments. “Peace and prosperity,” he theorized, “encourage preoccupation with one’s own petty affairs and allow people to forget that they are parts of larger communities. [During] the long economic boom . . . many Americans lost interest in public affairs, and in the larger world beyond America’s borders; others expressed growing contempt for government. . . . In this respect, Tuesday’s attacks on Wall Street were a salutary lesson.”
Now, Fukuyama may find people’s desire to be free and to be able to provide a good life for themselves and their families to be petty. He is, after all, part of an intellectual tradition that longs for the reinvention of the pre-Christian Greco-Roman polis, in which State and society are one, where individual rights are unknown, where the merchant class is expendable, and where the head of State becomes a god after his death. But it is the later ideas of liberty and individual rights, and the free-enterprise economy that are implied by both, that are the very foundation of the rise of Western civilization.
It is this freedom that makes authentic community, based on voluntarism and contract, possible in the first place. To provide for ourselves materially means to build family security, purchase the best education and medical care for our children, invest in new businesses that serve people with ever-better goods and services, give to charity and educational causes, fund the arts, and have time and space for the contemplative life. Prosperity is not a petty concern but the very pith of what it means to thrive and grow in peace.
The social cooperation engendered in the market economy is not only local but international, and symbolized by the activities that went on in the World Trade Center towers. Here were people who, in pursuit of their allegedly petty affairs, managed to facilitate trade and cooperation among two hundred countries and just as many language groups and currencies, and also to make a profit by doing so. Government has nowhere accomplished any of the miracles that are the daily business of free enterprise.
I would gladly compare the creative productivity of any business in the world to the goings-on in the highest councils of any government. If you have ever examined government closely, you know that the ideal of the all-encompassing polis as the ancients conceived it is actually a horror; any attempt to reimpose it, using wartime as the excuse, would result in a massive reduction in freedom, a trampling on human rights, further invasion of family and property, and a complete repudiation of everything the founders of this country worked to achieve.
But in these times, many are prepared to do just that. Letters to the editor of The New York Times scream that taxes must be raised, industry must be nationalized, privacy must be ended, and citizens conscripted. They say we should rally around the flag, and in doing so abolish everything that is good and right and true about America.
Yet that view was widely held long before the attack. Partisans of the statist model have been saying exactly this for centuries. Whether war or peace, prosperity or poverty, security or anxiety, there are some people who always find a good reason to justify Hegel’s conception of the State as God walking on earth.
When prosperity and security prevail, they say we are losing our sense of civic duty and need the State to restore it. They claim that the State must grow in order to check our natural tendencies to focus selfishly on ourselves and our families. In peace, they say we need the State to prevent war. In war, they say the State is the only answer. In times of crisis and upheaval, they see the answer as nothing short of what Mises called “omnipotent government,” total war and total State. For many of these intellectuals, there is never a good time for freedom and peace. For them, the State must always be on the move, or history is regressing
And make no mistake: the logic of the State apparatus is always to expand. As Mises says, “governments have always looked askance at private property. Governments are never liberal from inclination. It is the nature of the men handling the apparatus of compulsion and coercion . . . to strive at subduing all spheres of human life. . . . Statism is the occupational disease of rulers, warriors, and civil servants.”
As for those who believe that the State is the instrument by which we raise ourselves above our petty concerns to deal with crisis, Mises asks us to remember that the “State is a human institution, not a superhuman being. He who says ‘State’ means coercion and compulsion. He who says: there should be a law concerning this matter, means: the armed men of the government should force people to do what they do not want to do, or not to do what they like. He who says: this law should be better enforced, means: the police should force people to obey this law. He who says: the State is God, deifies arms and prisons. The worship of the State is the worship of force. . . .”
The worst aspects of a state are made worse in war. Says Rothbard, ”In war, State power is pushed to its ultimate, and, under the slogans of ‘defense’ and ‘emergency,’ it can impose a tyranny upon the public such as might be openly resisted in time of peace. War thus provides many benefits to a State, and indeed every modern war has brought to the warring peoples a permanent legacy of increased State burdens upon society.”
It is never more important to remember this than in a crisis, when people are so apt to give up their remaining liberties. Stalin once explained why he scrapped Lenin’s New Economic Policy, which permitted primitive free enterprise when the entire urban population was starving, and replaced it with a total command economy that he surely knew would cause chaos.
He explained: “Crisis alone permitted the authorities to demand—and obtain—total submission and all necessary sacrifices from its citizens. The system needed sacrifices and sacrificial victims for the good of the cause and the happiness of future generations. Crises enabled the system in this way to build a bridge from the factional world of utopian programs to the world of reality.”
As much as peace and prosperity is in our interest, it is not always in the interest of our rulers. In the eighteenth century, Voltaire observed that “the peoples are indifferent to their rulers’ wars” because then, after many centuries of just-war teachings, armed conflicts took place between rulers and didn’t affect the civilian population to any great extent. But that was before the modern State, beginning with the French Revolution, which draws the entire civilian population into every conflict, and targets them, as the pagans did.
One victim of modern war is commercial freedom. And all other freedoms are made vulnerable and attacked once this one falls. Notice that in all the tributes offered to the victims of the attack, precious little has been said about the people who worked in the World Trade Center, about the traders, brokers, insurers, speculators, money managers, stock analysts, and economists who lost their property and their lives. Some were friends of the Mises Institute.
On every other day, after all, the contribution of such people to society is denigrated. Government treats their jobs like crimes waiting to happen. Popular culture considers them parasites as Soviet propaganda demonized the kulaks. No fewer than three rap groups had CDs already in production featuring covers with the World Trade Center towers on fire. One of the CDs had a song called: “Five Million Ways To Kill a CEO.” The director of sales explained to The Washington Post that the group didn’t mean any harm; they were just carrying forward their desire for the “destruction of corporate America.”
That is precisely the message imbibed by students around the country in their classes, where assaults on free enterprise are core dogma. Students who come to us constantly express amazement and relief just to be out from under the tyranny of this intense indoctrination, which reflects the attitudes of the ruling regime toward the capitalist class.
The actions of the federal government after the terrorist attack have only contributed to the assault. Its first impulse was to ground all airplanes, close all flight schools, shut down the stock market, force foreign exchanges to prohibit trading in U.S. stocks, harass and fine so-called price gougers, and spy on Internet service providers. In short, the war on terrorism began exactly as you might expect: as a war on capitalism. Even worse, the new regulations and spending will make it more difficult for the economy to recover from the attack, much less climb out of the recession into which it was already heading after the bubble of the late 1990s.
Consistent with Mises’s theory of intervention, in which one action against market freedom seems to make others necessary, the federal government then bailed out both the financial markets through the creation of new money and the airline industry with direct subsidies. And this is just the beginning. The demands for wider circles of subsidies, bailouts, and every manner of central planning, will continue.
Not surprisingly, the very same people supporting this have also claimed that the terror attack was good for the economy. The absurdities began with Timothy Noah of Slate Magazine, who said that the rebuilding would spur an economic boom. Paul Krugman, a reliable and faithful Keynesian if there ever was one, said the same in The New York Times. But the claim wasn’t limited to the left. On the right, National Review echoed the same sentiments.
Austrian economists find it exasperating to have to explain again and again what Henry Hazlitt presented in his 1946 book, Economics in One Lesson. Picking up on a theme developed by Frederic Bastiat in the nineteenth century, he said that such a rationale—that catastrophe is good for the economy—ignores the alternative uses of resources had the destruction not occurred. This is the simple idea of opportunity cost, the very beginning of good economic analysis. But as Mises said, Keynes and his followers are wrong from their very first assumption.
Going further down the list of economy-killing devices, the federal government now has the power to impose eavesdropping on email. Then there are the preposterous regulations on the airlines. There is no more curbside check-in, no more parking near the terminal, no more metal utensils, and a physical search of bags. Never mind that none of this relates to anything having to do with the attack. The malicious people in this case used plastic box cutters, which were effective only because they were the biggest weapons on board.
The thing to do, then, to end hijacking, is to assure that pilots and crew are armed. Yet this continues to be opposed by the government. Why? For the same reason that nothing was done to arm teachers and principals after Columbine. The State is willing to consider any measure that takes away property rights and freedom, including the right to defend yourself against attack, but unwilling to consider reasonable suggestions that might actually solve the problem.
With every other war serving as precedent, the Federal Reserve has opened the monetary spigots, and is promising a total bailout of the banking system and stock market if necessary. Then there is the Office of Homeland Security, whose creation didn’t relieve a single anxiety anywhere in the country. The U.S. Constitution enumerates only a few functions of the central government, among which is to provide for the common defense. The feds tax and spend $2.1 trillion per year, and only now does it occur to anyone in Washington that it is time to secure the homeland.
Compounding the problem is that the new department will not protect us. The emphasis in the press is that this is a new “cabinet level” agency, as if giving its director access to cabinet meetings is going to protect it from becoming what every other agency in D.C. already is: not only a waste of money, but a threat to life and property and real security.
A march through the sorry history of war shows the same pattern again and again. Taxes, inflation, industrial planning, control of opinion, censorship, and brutality against civilians is a pattern. As for the problem of rampant militarism abroad, some of the best minds in the military and economic science have warned about the problem of blowback for years. Murray Rothbard did in the early 1990s. The historian Martin Van Creveld foresaw this as well. Among our own scholars, Robert Higgs, David Henderson, and Jon Utley issued many warnings. Hans-Hermann Hoppe has said again and again, at conferences that you may have attended, that the State’s security is an illusion.
But you haven’t read about this in the mainstream press, and, in fact, you have read very little about the relationship between the rise of the terrorist threat and U.S. policy. The self-censorship of our free press is truly a wonder to behold, and it applies whether the government is pursuing a war on terrorism or a war on poverty, drugs, tobacco, homelessness, disease, ill health, racism, ignorance, and a hundred other ills. We are told about the alleged progress, but rarely the setbacks. We are told about the supposed victories but not the costs.
Rarely are the initial ambitions compared with the actual results, for in each case we find that the program did not achieve what its designers claimed, and usually made the original problem worse. For example, it took a war on tobacco to actually increase the rate of teen smoking, a war on discrimination to actually increase unemployment among disabled people, a war on poverty to entrench an impoverished class, and a war on ignorance to cause the illiteracy rate and the cost of education to rise proportionally. I shudder to think what a full-scale war of terrorism is going to bring.
But there will be some unintended effects too. In the coming days and years, everything about our political system will be coming into question. Even now, when public opinion strongly supports political initiatives—at least that’s what people are willing to tell strangers phoning them—no one seriously believes that government action is going to make us more secure. We may look back at our current plight as the beginning of a sea change in attitudes toward the federal government, and the ideas of individual freedom and responsibility. The first impulse is always to expand the State. The next may be the rational one: to recognize that the State has failed us in every way, from employing Osama Bin Laden, to creating the Taliban, to fueling international hatreds, to disarming pilots, to failing to provide promised security.
We were told that the FAA was providing security on planes, but it turns out that the FAA was preventing it from being provided. We were told that the military would protect U.S. cities, but they couldn’t even protect their headquarters. We were told that a vast intelligence apparatus kept a watchful eye on terrorists, but the large group involved in this attack either went unnoticed or was ignored. We were told that U.S. foreign policy was designed to deter aggression, but it turns out to inspire it.
If the U.S. government were a private security agency, it would be fired and sued. But because it is a monopoly provider without voluntary customers, it can’t be. So it takes the opposite course after massive failure: it extracts even more money and grabs even more power.
The ultimate lesson is that we cannot trust the State to do what it says it will do. This truth is not going away, no matter how much they spend, regulate, propagandize, and control. The growth of international trade, the collapse of formal socialism abroad, the rise of a sense of solidarity among the taxpayers of all nations, the ability of the market to outperform the government in every area of life, the advance of libertarian theory—all have combined to make it very difficult for the nation State to operate as it once did.
Many people look to the 1930s or the 1950s as the model for the current wartime mode. In those days, the intellectual movement that backed a consistent application of libertarian principles at home and abroad was very small indeed. But during the last twenty years, this too has changed. We have a huge commercial class that has seen how politics poses a deadly threat to trade, commerce, and enterprise. We have a burgeoning middle class that knows better than to believe that any sort of central planning will be good for them. We have a large and growing movement of intellectuals for freedom in universities who are teaching more and more students in the Misesian tradition of thought.
We have centers of thought springing up all over the United States, but also in Paris, Madrid, Bucharest, and even Moscow. The translations of works are proceeding so quickly it is difficult to keep track. There is now enough quality scholarship in our tradition to support several major journals and publishing programs. It was Jeffrey Herbener, director of our Austrian Scholars Conference, who called our movement the largest intellectual global conspiracy since Marxism.
Indeed, a new book by a Marxist blames free marketeers and the Mises Institute for stopping the progress of socialism by clouding the minds of the masses and preventing them from seeing their true interests. We would say clarifying, not clouding, but it is not difficult to be flattered by his claim, for that is precisely what the ideas of liberty do indeed accomplish.
It was Mises’s view that the role of intellectuals is to boldly dissent from conventional wisdom, and proclaim what they know to be true, especially in the most difficult circumstances. You believe that too, and that is why you have been so supportive of our work. You have taken up Mises’s challenge to throw yourselves into the intellectual battle.
What does this accomplish? Everything in the world. Just stating what is true can cause minds to change, conventions to collapse, and even States to decline. Just saying what is true is the most powerful weapon in the history of liberty. It is what terrorists and despots fear, and it is ultimately the very basis of freedom itself.
Tomorrow is the 120th anniversary of Ludwig von Mises’s birth. What better way to celebrate that than the dedication of this campus to his memory and ideals? In the conservatory you will notice that we reprint his lifetime motto, adopted from Virgil when he was in high school. We have it in many languages because ours is truly an international school. The words in Latin are “Tu ne cede malis, sed contra audentior ito.” In English, they are: “Do not give in to evil, but proceed ever more boldly against it.”
We should never tire in our mission to point out that there is an alternative to the Politically Correct Left and the Militarized Right: that there is freedom itself, the genuine article, and a tradition of thought in defense of freedom unmatched by any other in its rigor and dedication. This ideal will continue to rise from the ashes, again and again, to point the way forward to peace, prosperity, and liberty.
[Adapted from an address on the occasion of the dedication of the Ludwig von Mises Institute’s new campus, September 28, 2001, Auburn, Alabama.]
