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Mises was Right, Part 2: Feulner, Neocons, Heritage, Georgia, Mont Pelerin

“It turns out, of course, that Mises was right.”
—Robert Heilbroner (1990), “After Communism”, The New Yorker, September 10: 92 (1, 2, 3)

Regarding Paul Craig Roberts’s “I Resign from the Mont Pelerin Society“:

Interesting connected facts:

1. Formerly libertarian Mont Pelerin Society (which lists Hayek, Friedman, “Coase,” and others as “Notable Members”, but not Mises): its Treasurer is one “Edwin Feulner.”

2. Feulner is President of Heritage.

3. In “Saving Georgia,” Heritage Web Memo #2021, and The Russian-Georgian War: A Challenge for the U.S. and the World, on “Ariel Cohen, Ph.D.” buys into the Bush administration’s propaganda that uses “the Russian invasion of Georgia” as an excuse for further American hegemony.

No wonder Hans-Hermann Hoppe founded the Property and Freedom Society to take up the reins that MPS has dropped.

As Guido Hu?lsmann noted in “Ludwig von Mises and the Mt. Pelerin Society. Strategic Lessons” a speech delivered at the inaugural meeting of the PFS in 2006 (summary; program):

As classical liberal economists were usually not employed in institutions of higher learning (the teaching of economic science was not primarily organized within the universities), they built other institutions, from loose networks to political parties. By 1860 governments realized the danger to themselves that the classical economists posed. Their answer was to create their own economists and thus control the market of ideas. This strategy was first applied in Germany with the German Historical School or “Schmollerism” and soon spread to other countries, each with its own specific national feature. John Stuart Mill in Britain for example changed the meaning of liberalism into interventionism, while the Russian government thought that Schmoller was too tame and hired Marxist economists instead.

This trend continued into the 20th century, with Ludwig von Mises being one of the very few setting himself against it. After demolishing the case for socialism and putting the case for radical liberalism, he insisted that no “third way” was possible, as this would invariably lead to a loss of prosperity and in the end, socialism.

In the first half of the 20th century, a number of societies were founded by liberals to counter the trend towards socialism. By 1938, four schools of thought were represented:

Neoliberalism, i.e., practical and theoretical compromise with socialism; F.A. v. Hayek, for whom a small amount of intervention was permissible; Alexander Rüstow, who considered natural hierarchies as necessary for society; and Ludwig v. Mises, who stood for complete laissez faire.

Nine years and one World War later, these groups convened to form the Mont Pèlerin Society (MPS). At the same time, Leonard Read’s FEE in America was publishing leaflets explaining the ideas of Mises and organizing seminars and speeches for Mises and others. These activities were extremely important for spreading Mises’ thoughts, especially to young people. Ralph Raico, George Reisman and Murray N. Rothbard were among those influenced by the FEE papers. Without the FEE, the Chicago School would have totally dominated the field of free market ideology.

Mises was skeptical about the MPS right from the start; he was particularly concerned because of the participation of certain people. In 1947, he stormed out of a meeting, saying: “You’re all a bunch of socialists.”

Today, the MPS, a society of eminent scholars, mainly represents Neoliberalism. Therefore, the PFS could play the role that the MPS was originally designed to play: spreading the uncompromising intellectual radicalism of freedom.

(See also Hu?lsmann, Mises: The Last Knight of Liberalism, pp. 871, 989-90, 1003-10, 1032, et pass.)

This helps place in context the principles for the PFS as announced by Hoppe at its founding in 2006:

The Property and Freedom Society stands for an uncompromising intellectual radicalism: for justly acquired private property, freedom of contract, freedom of association …. It condemns imperialism and militarism and their fomenters, and champions peace. It rejects positivism, relativism, and egalitarianism in any form …. As such it seeks to avoid any association with the policies and proponents of interventionism, which Ludwig von Mises had identified in 1946 as the fatal flaw in the plan of the many earlier and contemporary attempts by intellectuals alarmed by the rising tide of socialism and totalitarianism to found an anti-socialist ideological movement. Mises wrote: “What these frightened intellectuals did not comprehend was that all those measures of government interference with business which they advocated are abortive. … There is no middle way. Either the consumers are supreme or the government.

***

See also:

Re: Capture of Mont Pelerin Society by Neocons

Posted by Stephan Kinsella on August 21, 2008 01:35 PM

Tom, the MPS displays Hayek, Friedman, Coase, and others as “Notable Members”, but scandalously omits Mises. Their excuse for leaving him out is that they list only Nobel winners (though the category is “notable”, not “prize-winning”); but Mises towers above all of them.

Roberts’s article links one of Heritage’s pieces on the “Russian invasion of Georgia” Bush line; others are “Saving Georgia,” Heritage Web Memo #2021, and The Russian-Georgian War: A Challenge for the U.S. and the World, by Ariel Cohen, Ph.D.

Mises was right about socialism (“It turns out, of course, that Mises was right” — Robert Heilbroner, 1990 [1, 2, 3]); and he was right about the PFS. As Guido Hu?lsmann noted in a 2006 speech “Ludwig von Mises and the Mt. Pelerin Society. Strategic Lessons“:

As classical liberal economists were usually not employed in institutions of higher learning (the teaching of economic science was not primarily organized within the universities), they built other institutions, from loose networks to political parties. By 1860 governments realized the danger to themselves that the classical economists posed. Their answer was to create their own economists and thus control the market of ideas. This strategy was first applied in Germany with the German Historical School or “Schmollerism” and soon spread to other countries, each with its own specific national feature. John Stuart Mill in Britain for example changed the meaning of liberalism into interventionism, while the Russian government thought that Schmoller was too tame and hired Marxist economists instead.This trend continued into the 20th century, with Ludwig von Mises being one of the very few setting himself against it. After demolishing the case for socialism and putting the case for radical liberalism, he insisted that no “third way” was possible, as this would invariably lead to a loss of prosperity and in the end, socialism.

In the first half of the 20th century, a number of societies were founded by liberals to counter the trend towards socialism. By 1938, four schools of thought were represented:

Neoliberalism, i.e., practical and theoretical compromise with socialism; F.A. v. Hayek, for whom a small amount of intervention was permissible; Alexander Rüstow, who considered natural hierarchies as necessary for society; and Ludwig v. Mises, who stood for complete laissez faire.

Nine years and one World War later, these groups convened to form the Mont Pèlerin Society (MPS). At the same time, Leonard Read’s FEE in America was publishing leaflets explaining the ideas of Mises and organizing seminars and speeches for Mises and others. These activities were extremely important for spreading Mises’ thoughts, especially to young people. Ralph Raico, George Reisman and Murray N. Rothbard were among those influenced by the FEE papers. Without the FEE, the Chicago School would have totally dominated the field of free market ideology.

Mises was skeptical about the MPS right from the start; he was particularly concerned because of the participation of certain people. In 1947, he stormed out of a meeting, saying: “You’re all a bunch of socialists.”

Today, the MPS, a society of eminent scholars, mainly represents Neoliberalism.

(See also Hu?lsmann, Mises: The Last Knight of Liberalism, pp. 871, 989-90, 1003-10, 1032, et pass.)

Similarly, as Hoppe has observed: Mises identified in 1946 the association with the policies and proponents of interventionism

as the fatal flaw in the plan of the many earlier and contemporary attempts by intellectuals alarmed by the rising tide of socialism and totalitarianism to found an anti-socialist ideological movement. Mises wrote: “What these frightened intellectuals did not comprehend was that all those measures of government interference with business which they advocated are abortive. … There is no middle way. Either the consumers are supreme or the government.

The Mises quote is from “Observations on Professor Hayek’s Plan,” typewritten memorandum dated 31 December 1946; Grove City Archive: MPS files (unfortunately unpublished).

As Hu?lsmann notes, in this memoradum, Mises

stated that many similar plans to stem the tide of totalitarianism had been pursued in the past several decades—he himself had been involved in some of these projects—and each time the plan failed because these friends of liberty had themselves already been infected by the statist virus: “They did not realize that freedom is inextricably linked with the market economy. They endorsed by and large the critical part of the socialist programs. They were committed to a middle-of-the-road solution, to interventionism.” At the end of the memorandum, he stated his main objection:

The weak point in Professor Hayek’s plan is that it relies upon the cooperation of many men who are known for their endorsement of interventionism. It is necessary to clarify this point before the meeting starts. As I understand the plan, it is not the task of this meeting to discuss anew whether or not a government decree or a union dictate has the power to raise the standard of living of the masses. If somebody wants to discuss these problems, there is no need for him to make a pilgrimage to the Mount Pèlerin. He can find in his neighborhood ample opportunity to do so.

Hu?lsmann, Last Knight, pp. 865-66.

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