This action might not be possible to undo. Are you sure you want to continue?
Value Freedom, Laissez Faire, Mises, and Rothbard: A Comment on Professor Gunning Author(s): Walter Block Reviewed work(s): Source: American Journal of Economics and Sociology, Vol. 64, No. 3 (Jul., 2005), pp. 919-938 Published by: American Journal of Economics and Sociology, Inc. Stable URL: http://www.jstor.org/stable/3488166 . Accessed: 12/01/2013 17:13
Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp
JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact email@example.com.
American Journal of Economics and Sociology, Inc. is collaborating with JSTOR to digitize, preserve and extend access to American Journal of Economics and Sociology.
This content downloaded on Sat, 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions
Value Freedom, Laissez Faire, Mises, and Rothbard
A Comment on Professor
BLOCK* By WALTER
Introduction of ALTHOUGHTHEREARE ELEMENTS Gunning (2005) with which I shall take issue, I want to begin by enthusiastically welcoming its publication. Gunning discusses the views of Rothbard and Mises on normative and positive economics, and their relationships. Since the latter two1 are giants in the field of laissez-faire studies, any focus on their vastly underappreciated work is thus presumptively an important contribution to the literature. Second, it is very important to reconcile advocacy of the system of economic freedom, or laissez-faire capitalism, with value freedom, or vertfreibeit, a necessary dimension of economics as a discipline. Is it possible to both favor the market system and be a value-free economist? is the vitally important question to which Gunning addresses himself, and he is to be congratulated for bringing it to our attention in the forceful manner he does. Third, this paper is welcome on the grounds that Mises and Rothbard agreed with each other on virtually all areas of political economywith the notable exception of this one issue. Professor Gunning has unearthed a man-bites-dog story wherein these two Castor and Pollux economists strongly diverge in their perspectives. His bringing of this situation to our attention is therefore alone worth the price of
*Dr. Block is the Harold E. Wirth Eminent Scholar Chair in Economics at the College of Business Administration, Loyola University, New Orleans, LA 70118; www.cba. loyno.edu.
American Journal of Economics and Sociology, Vol. 64, No. 3 (July, 2005). ? 2005 American Journal of Economics and Sociology, Inc.
This content downloaded on Sat, 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions
Gunning (2005: 908) cites Rothbard's (1976a: 101) mention of the following very important passages in Mises's (1966: 883. cannot properly be anthropomorphized in such a manner. it is now time to bring forth a critical analysis of Gunning's contribution. for I believe him to be in error in many of his specific claims. only they can engage in human action.and finds that a does p for the attainment not resultin p but in g. Gunning. This is surprising since Gunning is very thorough throughout the remainder of his paper in citing not only Mises but Rothbardas well. to underpin his contentions about the views of these two authors. He merelysays thatfromthe point of view of those aiming at the goal p. not only errs in this claim. 764) analysis of value freedom: An economistinvestigating whethera measurea can bringaboutthe result of which it is recommended. but is also mistaken in attempting to garner support from Mises on this point.If the economiststates the outcome of his investigationby sayingthat a is a bad measure. Goals Having said this. But nowhere in Mises can any such claim be found. Economics. strictly speaking. B. Unanimity In the next section of his paper. in other words. whatever it is. the measurea is inappropriate. Only human beings can be motivated by ends.920 The American Journal of Economics and Sociology II Critique A. He starts off attributing to Mises the view that Mises's reconciliation of laissez-faire advocacy and economic vertfreibei? "stemmed from his conception of the goal of economics" (Gunning 2005: 902). (Statement1) This content downloaded on Sat. He does this without benefit of any support from Mises himself. and cites Mises in support of this contention. The difficulty here is that. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .3Gunning takes the opposite point of view. the attempt to substitute a less satisfactory present state of affairs for a better one that would otherwise occur in the future.he does not pronouncea judgment of value. economics is not the sort of enterprise that by its very nature can have goals. an effectwhich even the supporters of the measure a considerundesirable.
that it makes conditions worse. not better. that it makes conditions worse.. (Statement 1) Economics does not say that . Instead. government interference with the prices of only one commodity . If the economist states the outcome of his investigation by saying that a is a bad measure.. is unfair. If Gunning is correct. It is true that Mises uses the plural concepts "supporters"and "those aiming at a goal. and finds that a does not result in p but in g. an effect which even [SOMEOF] the supporters of the measure a consider undesirable. the measure a is inappropriate. or unfeasible. He merely says that from the point of view of [SOMEOF] those aiming at the goal p. p. nothing in the context within which this paragraph appears suggests that Mises is writing about some variant of the unanimity principle. quite correctly in my view..Comment on Gunning 921 Economics does not say that . by all accounts. from the point of view of the government and [SOMEOF] those backing the interference. 883 [italics added by Gunning]). In addition. then the three statements would read as follows: An economist investigating whether a measure a can bring about the result p for the attainment of which it is recommended.. Let us test Gunning's interpretation. But Gunning rejects this analysis on the grounds that Rothbard has misunderstood Mises.. Nor does the context in which this passage occurs.." However. The paragraph in which these sentences appear ends with the following: "If an economist calls minimum wage rates a bad policy. We shall do so by making explicit that which. is unfair. the pluralization does not imply unanimity in any reasonable interpretation. what he means is that its effects are contrary to the purpose of [SOMEOF] those who recommend their application. is only now implicit. from the point of view of the government and those backing the interference. (Statement 3) This content downloaded on Sat. the economist can investigate whether the policy will actually achieve the goal. government interference with the prices of only one commodity . It says. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . he simply points out that if anyone describes (1) the policy he favors and (2) the goal he expects it to achieve. what he means is that its effects are contrary to the purpose of those who recommend their application" (Ibid. bad. States Gunning (2005: 908-909): In the first [of the two passages quoted above]. It says. (Statement 2) If an economist calls minimum wage rates a bad policy.. Rothbard. or unfeasible.. criticizes Mises for using a variant of the unanimity principle in these statements. Mises says or implies nothing about unanimity. bad. not better. he does not pronounce a judgment of value.. (Statement 2) I shall refer to the first paragraph above as Statement 1 and to the second as Statement 2.
is unfair."7 In one of the most brilliant contributions to the entire This content downloaded on Sat. if Rothbard's interpretation of Mises is correct. ALLOF the supporters of measure a.he does not pronounce a judgmentof value." and of the minimum wage. then how can even a semi-rational Mises possibly have concluded that no value judgments were needed to reach the respective conclusions he did? So only the phrase ALL OF.. the measure a is inappropriate. Whose interpretation of Mises is correct? That of Rothbard or that of Gunning? To ask this question is to answer it. that it makes conditionsworse. It says. But ALLOF is compatible with. when made explicit. and Gunning's mistaken. not SOMEOF. can make explicit what is implicit in these three statements of Mises. what he means is that its effects are contrary to the purpose of [ALL OF]those who recommend their application. Mises Would Not Know . and only with.... 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . He merelysays that from the point of view of [ALL OF] those aiming at the goal p.. QED.and finds that a does p for the attainment not resultin p but in g. would read as follows: An economistinvestigating whethera measurea can bringaboutthe result of which it is recommended. not better.6 C.If the economiststates the outcome of his investigation by saying that a is a bad measure. or unfeasible.922 The American Journal of Economics and Sociology In contrast. given their own goals of economic efficiency and reducing the unemployment rate for the unskilled.bad. Gunning correctly appreciates the fact that Rothbard criticized Mises on the ground that the latter "could not know the goals of policy advocates. If only SOME OF the adherents of these regulations see them as problematic. "government interference with the prices of only one commodity. unanimity. (Statement 2) If an economist calls minimumwage rates a bad policy. if Mises's point is to be intellectually coherent. as claimed by Rothbard and denied by Gunning.. an effect which even [ALL OF]the supportersof the measurea considerundesirable. then the three statements. (Statement1) Economicsdoes not say that. must agree that these measures make no sense. governmentinterference with the prices of only one commodity.(Statement 3)5 So.from the point of view of the governmentand [ALL OF]those backingthe interference. from their own point of view.
afterlearningeconomics. These scales have no independentexistence The only source fromwhich apartfromthe actualbehaviorof individuals.Comment on Gunning 923 annals of intellectual criticism.anxious to use the Some may be egalitarians who controlsas a step towardfull collectivism. may show that price control (to use his example) will lead to unforeseenshortagesof a good to the consumers. "excessiveaffluence" they may all delightin the shortagesof goods." nomist. for example.because they.eager to see shortagesof goods.will enjoywell-paying jobs or power in the pricecontrolbureauwith cracy.that all the supportersof the price control-or of any other governmentintervention-must concede.thatthe measureis bad.then.even afterlearningof the shortages. a technician. ing out to his readersor listenersthat theywill all considera policy "bad" once he reveals its full consequences. Rothbard (1976a: 101-103) responds to the three statements of Mises as follows: Now this is surely an ingenious attempt to allow pronouncementsof for "good"or "bad" by the economistwithoutmakinga value judgment. for whateverreason. Stillothersmay favorprice control. Given Mises'own analysis. or how people will regardthe consequencesof these polices? Thus. Some may be nihilists. and none of them are compatible Mises asserting. how can the economist know what the motivesfor advocatingvariouspolicies reallyare.as a value-freeeconomist. a pointthe economistis supposedto be only a praxeologist. our knowledge concerningthese scales is derivedis the observationof a man'sactions. In fact. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .can no longercall any of these measures"bad" This content downloaded on Sat. or theirpolitical allies. But ingenious as it is. But how does Mises know that some advocatesof price control do not want shortages? They may. as a praxeologistand ecoor even or "good. the attempt completely fails. prefershortagesbecause the rich will not be able to use their money to buy more of the productthanpoorerpeople.Everyaction is always in perfectagreementwith the scale of values or wants because these scales are nothingbut an instrument for the interpretation of a man'sacting. Mises.once Misesconcedes that even a single advocateof price controlor any other interventionist measuremay acknowledgethe economic consequences and still favor it. qua economist.All sortsof possibilitiesexist. or aboutthe great "waste" of energy. then Mises. Othersmay be one of the numerouslegion of contemporaryintellectuals who are eternally complaining about the of our society. For how does Mises know what the advocates of the particularpolicy consider desirable?How does he know what their value-scalesare now or what they will be when the consequencesof the of praxeologiceconommeasureappear?One of the great contributions ics is that the economist realizes that he doesn't know what anyone's value scales are except as those values preferencesare demonstrated by a person's concrete action.be socialists.
the functionalist can underminethe arguments used in supportof these policies. Rather. that it will help unskilled workers."8 But just because Eshelman is correct in this contention does not in the least support Gunning's claim that Rothbard is wrong to question "how could Mises know what advocates of the particular policy consider desirable. Those who advocatea minimumwage. he mobilizes Eshelman (1992) in support of his position.By showingthatcertainpolicieswill have the opposite effect fromthatproclaimed. and This content downloaded on Sat. both of which make Gunning's reliance on him problematic. This must be taken with at least a small grain of salt in that Eshelman (1992: 3) begins his essay on the following note: "I agree with Rothbard that utilitarianism. it is certainly true that some advocates of minimum wages. That is. There are two difficulties with Eshelman's account. on the issue in question. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . is a valid one. But this is by no means true of all of them. but himself an advocateparticipating on one side of a value conflict. but theirproclaimedgoal is thatthey wantto help the poor.Forthen he is no longer being a technicalreporter to all advocatesof a certainpolicy. Gunning is correct is interpreting Eshelman as an ally." However. it cannot be denied that Eshelman is very much on the mark when he shows that it is indeed a telling point on the part of Mises against the advocates of minimum wage that when they "recommend" this legislation in an effort to combat poverty." "appropriate" without inserting into his economic policy pronouncements the veryvaluejudgements thatMiseshimselfholds to be inadmissible in a scientistof humanaction. at least." Even if Mises is correct. Second. may reallywant to makenonunionlaboruncompetitive. which can be shown to be mistaken. States the latter (Eshelman 1992: 6): I do not think that [Rothbard's] criticismhits the mark. their arguments are "undermined.924 The American Journal of Economics and Sociology or "inappropriate. Rothbard's criticism of Mises.whether direct or indirect. that he illegitimately relies on knowledge of their motivations. Is Gunning impressed by this tour de force? Not a bit of it. even many of them. for example. First of all. cannot provide a principled defense of laissez faire.Mises'sargument is simply that such policies will not accomplishtheir proclaimedgoals. support this law in the belief. some proponents of this pernicious legislation champion it in the absence of any reasons. For them.
" indicating that he is using it in the spirit in which Mises meant it." whereupon Gunning goes on to cite Mises in this regard. we stipulate for the sake of argument that Eshelman had the better of Rothbard. what he means is that its effects are contrary to the purpose of those who recommend their application" (Statement 3). it still does not follow that Rothbard was mistaken in upbraiding Mises for assuming knowledge the latter could not possibly possess. that the measure is 'bad.9e. Mises made two claims.' But Mises did not make this assertion."that is. But upon further reflection. Indeed. On the contrary. No. that the latter was mistaken in criticizing Mises's undermining of the minimum wage advocates. It cannot be overemphasized that there are really two very different issues involved in this discussion."Further. if not to the actual letter. consider what he wrote about people who hold myths. for they are not contradicting one another. Gunning is correct in his criticism of Rothbard. the latter places quotation marks around the word "bad. But Mises also made a second claim. For what more does "bad" mean than "worse"?"Worse. it is easy to see the error of Gunning's way. not merely one. One is Mises's treatment of the This content downloaded on Sat. this proves that Rothbard must be wrong in his. Rothbard is still correct in maintaining that Mises has no warrant for assuming what the purposes are of those who recommend the minimum wage. entirely separable from the first. In other words. Mises specifically disavows such nomenclature.. At first superficial glance. since Eshelman is correct in his calculation.Comment on Gunning 925 Rothbard incorrect when the latter criticizes the former in terms of proclaimed goals. In the first. and along came Gunning with the view that. and Eshelman averred that 3 + 3 = 6. in the quote that Gunning cites from Rothbard. both can be correct.g. to wit. Gunning (2005: 909) continues his attack as follows: "Rothbard further claims that Mises asserts 'that all supporters of price controlor of any other government intervention-must concede. in Statement 2. Mises does not use the word "bad"and yet Rothbard attributes this to him. that "[i]fan economist calls minimum wage rates a bad policy. after learning economics.10 It is as if Rothbard said that 2 + 2 = 4. is every bit as much a part of normative discourse as is "bad. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .
if this conclusion is obviously in error. and misinterprets the latter to boot. What this does is take the essence of an argument to its logical extreme. supposedly on a value-free basis. more bizarrely. or by criminal penal- This content downloaded on Sat. Rather. This is irrespective of whether these policies can or must make us better off from the perspective of their adherents. TimePreference Gunning takes Rothbardto task for the latter's supposed misconstrual of the economics of time preference. The issue here is whether they can improve matters from the point of view of their proponents. Rothbard nowhere maintains that Mises specifically states "that economics is only concerned with long-run interests. be clear on the argumentum reductio ad absurdum. I am not aware of Mises ever writing that economics is only concerned with long-run interests. then so must be its initial statement. In his (Gunning 2005: 916-917 n. even if it did not seem quite so problematic when first stated. The confusion arises not because of any shortcomings of Rothbard. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . that Rothbard conflates Mises and Hazlitt.'2 Just so that we can be crystal clear on this type of argument. but is rather due to Gunning's failure to understand and/or appreciate the force of an argumentum reductio ad absurdum. Rothbard'sview "cannot be correct. tariffs. The second is Rothbard's analysis of objective ethics and its relationship to public policy pronouncements of economists. Thus. or subsidies. maintaining that either the latter cannot distinguish between Mises's own views and those of the classical economists." Very much to the contrary. Gunning's search for the source of Rothbard's"error" is very much in vain.Rothbard was attempting to illuminate a very different question: Are these things right. then. Suppose that someone claims that crimes of passion cannot be reduced by punishment. or. such as minimum wage laws.5) opinion. regardless of whether they are consistent with the goals of their advocates?' D.926 TheAmerican Journal of Economics and Sociology justificationsfor public policy proposals. Rothbard is claiming that the logic of Mises's argument implies precisely this." Gunning goes on to gratuitously insult Rothbard. Let us. let us consider a few examples.
the judge should award property titles to whichever of the claimants would have ended up with them in the zero transactions costs world. such a scenario taking place where police officers frequent. I rejoined (Block 1996) that in the zero transactions cost world. It would not at all serve as a refutation of this reductio to maintain that the exponent of the claim to the contrary never contemplated. Simpson might have been able to buy up the ownership rights to his late ex-wife. or a murderer. In my reply (Block 2003) I make the point that Zorn. and yet is implied by the initial faulty premise.Comment on Gunning 927 ties. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . 0. Yet rapes and murders often occur elsewhere. Simpson or his ex-wife. he should not be considered guilty of murder. ignores the reductio ad absurdum mode of argumentation. J. perpetrators of so-called crimes of passion do pick and choose their spots. therefore. they are not entirely unconscious of penalties and sanctions. J. That is the whole point of a reductio: it extends the "logic" of a false claim. and therefore even if he in fact did kill her. Zorn (1996) criticized this analysis on the ground that Coase had never even once mentioned 0. and the higher the floor This content downloaded on Sat. Nicole. the last thing the exponent of such a contention has in mind when he utters this claim is the specter of a rapist. This suggests that. Advocates of the minimum wage maintain that this legislation places a floor under wages. in full view of scores of police. concocts a scenario that is obviously false or problematic.13since perpetrators in the throes of such sentiment are oblivious to such things. contrary to the assertion. If the claimant had but foreseen the reductio scenario. he would not likely have made this claim in the first place. that just because Coase never contemplated the Simpson murder trial does not preclude me from using it to test the implications of Coase's theory of property rights."a case could be made out for the claim that 0."4 A third example. let alone mentioned. Coase (1960) has famously argued that in the world of positive and significant transactions costs. Another example. And yet this constitutes a reductio ad absurdum of his view: an infinitesimally small number of rapes and murders take place right in front of the desk sergeant. Simpson was the rightful owner of his former wife. J. since he would only be disposing of his own property. Now. as is the case for Gunning. doing his evil deed in the environs of a police station. according to Coasean "logic.
They have in mind raising the minimum to. is a utilitarian"(Gunning 2005: 911). But Rothbard pithily focuses on consumers with high time preferences. defenders of this legislation never had in mind anything as grotesque as raising it to this level. once they become acquainted with these inevitable results through a study of economics. even if they are fully cognizant of economic law. prosperity and abundance" (cited in Rothbard 1976: 105). but this is entirely irrelevant to Rothbard's analysis. the $7-$10 per hour range."5 E. and shortages that will result from these policies. poverty. the citizen. they may still favor these government interventions on the grounds that the negative effects will appear only after some time has passed.000 per hour. Of course.928 The American Journal of Economics and Sociology the better for the poor and unskilled. At this level it is obvious that no one at all would be employed. Mises limits his utilitarian vision to making common cause with other citizens in favoring only "peace. If the economist qua economist cannot make value judgments concerning the economy. they will heavily discount these adverse repercussions. Let us now return to the present case. say. Rothbard is employing a reductio against Mises. They would object to it as being "unlikely"or "too theoretical. Mises never said that. and that with their high rate of time preference. Therefore."But despite such an objection. Of course. Citizen Gunning quite accurately reports that Rothbard'snext critique of Mises concerns the latter's stance as citizen. This content downloaded on Sat. they will cease and desist from advocating them. It should by now be clear that Gunning has no warrant to object to it on the basis of Mises never writing that economics is only concerned with the long run. What are Gunning's criticisms of Rothbard under this heading? He starts off by complaining of the fact that "Rothbardpresents no evidence that Mises. says Mises. A reductio against this idea is to offer to raise the minimum wage to $100. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . this constitutes a telling reductio against that position. The latter is on record as stating that even the proponents of high taxes and subsidies and price controls do not welcome the capital dissipation. Rothbard's reductio of Mises. he can certainly do so in his capacity as a citizen.
that Mises was an economist. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .. According to Rothbard.g.18 Gunning then goes on to relate Mises's actual writings. is probably almost equally well established as these other characteristics. This leads to an obvious response: "If this isn't utilitarianism. that we have excessive wealth that ought to be reduced. never denied by Mises. Were Rothbard to have documented such matters-and even Gunning himself concedes that "Mises's support for the ideology of laissez faire . "[t]he only reply that Mises could make within his own framework was to point out that government intervention has a cumulative effect.17And the trouble with this. for egalitarianism) might well lead the general public in the wrong socialistic direction. for "food. even a citizen. even a drastic amount-of statism in order to achieve some of their competing goals?"16 Rothbard shows that in addition to yearning for "peace. that eventually the economy must move either toward the free market or toward full socialism" (1976: 106). was not based on utilitarianism" (Gunning 2005: 911)-space limitations would have prevented him from addressing the issues in question. And yet his utilitarianism." the average citizen also wishes to indulge in envy by promoting egalitarianism. wrong" (Gunning 2005: 912). a la Galbraith(1958).. while acknowledging but dismissing the long-run ill effects."e.. and other material amenities" (Gunning 2005: 911)." economic "progress.Comment on Gunning 929 This is more than passing curious. And how does Gunning criticize Rothbard in this regard?He states.g. according to Rothbard. prosperity and abundance. and "may prefer to loot the capital of the rich or the businessman in the short run. clothes. not all of them are. then what is?" Next. "Rothbard'sdiscussion about how Mises would respond to such a case is speculative and. because they have a high time preference" (Rothbard 1976: 106).thinks. is that while many interventions are cumulative. Gunning mentions Rothbard's incisive critique of Mises: "What could Mises reply to a majority of the public who have indeed considered all the praxeological consequences and still prefer a modicum-or. or. . in any case. either. time preferences or other goals (e. for Rothbard presented no evidence. for that matter. I believe. a man. or lack thereof This content downloaded on Sat. Gunning mentions that Mises supports the populace in its quest for "earthlyends. homes. for that matter. In somewhat of a turnabout. and.
And since it is Gunning who is criticizing Rothbard. nonexcludability. but not in the context of whether or not a praxeologically sophisticated citizen would perforce have to oppose it."It has to be. market failure. he looks at how he would. This is all very interesting. exhibiting no This content downloaded on Sat. how is he forced by the laws of logic to respond to Rothbard's challenge of responding to citizens who understand praxeological economics and still prefer a modicum or more of interventionism?Rothbard answers this question for Mises in terms of cumulation of interventionistic error. in attempting to refute Rothbard. and also to his views that as a "citizen" he is free to make public policy pronouncements of a value-laden nature. roads. to mix my metaphors. further interventions to cure the difficulties created by the first round of price controls. and constitutes an informative exegesis into the writings and philosophy of Mises. his failure to come to grips with what Rothbard was actually saying precludes Gunning from succeeding in this attack. income redistribution. In the previous paragraphs I have purposefully emphasized the word "could"for quotes from Rothbard. public goods. Gunning fails to refute Rothbard because. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . and finds fault with it because not all errors are cumulative. jointness in demand. and even those that are can be ignored on the ground of time preference and desires for egalitarianism. concerning such things as price controls. Gunning. Rothbard is asking the question: If Mises is to remain true to his other writings. and "would" for those from Gunning. Instead of asking how Mises (logically) could answer the Rothbardchallenge. and so on. and reports to us in this vein.930 The American Journal of Economics and Sociology in some cases. But Rothbard was asking a contrary-to-fact conditional: Given that Mises never did address this issue. is not even in the same ballpark. That is to say. It is my contention that Gunning and Rothbard are passing each other as do "ships in the night. It cannot be denied that Mises wrote intensively about the positive issue of whether government intervention is cumulative. But it is all beside the point. interprets this in terms of how Mises actually did discuss this and related topics. since Mises never directly confronted this issue. what answers are logically open to him? Of course this is "speculative. the two of them are operating on different wavelengths." That is.
whateverunless he makesan ultimate this is so. It is useless to speculate about why Rothbard misinterpreted Mises when in fact he did not. But to add insult to injury." They are not exactly synonymous in all situations.Comment on Gunning 931 evidence of knowing what Rothbard said.allegedly ethical standards" (Rothbard 1976: 108). let alone refute him. Discursive Reasoning Mises's third attempt to square the circle was to demand that those who denigrate private property rights and free markets not do so on the basis of "arbitrary. he could not even directly confront him. If a proposal for or against socialism or capitalism is not a public policy. Had this passage not appeared in the distinguished pages of this journal. Instead. and since accordingto Mises all ultimatevalue judgmentsor how then could he denounce these parethical standardsare arbitrary. But since it did. Gunning interprets Rothbard as some sort of mathematical economist who focuses only on This content downloaded on Sat. Rothbard's Misinterpretation of Mises This is a rather tendentious section of Gunning's paper." But this objection is difficult to understand. Indeed. [such as] the advocacy of capitalism and socialism. On the other hand. that Mises would have to concede that no one can decide upon any policy Butsince ethicalor value judgment. Mises was not referring to the use of discursive reasoning to evaluate a public policy. In the cited passage. there is a difference between the phrase "public policy" and "proposals. (1976: 109) ticular ethical judgments as "arbitrary"? He (2005: 913) states: And what is Gunning's refutation of Rothbard? of "Rothbardtook Mises's statement out context. there is not a "dime's worth" of difference between them. Yes. they can surely be used interchangeably. I cannot forebear. in the context of the present discussion. F.19Rothbard replies.20I would find it onerous to have to make such a reply. I do not know what is. he was referring to its use in evaluating the logic of the proposals advocated by others. G. quite definitively. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .
See this website: http://www. reprinted from Rothbard (1975: 38-41). 1973a. Can one logically defend laissez-faire capitalism without recourse to value statements in the premises of the argument? Rothbard says not.932 The American Journal of Economics and Sociology equilibrium states at the expense of market process. Rothbard's claim as a champion of free enterprise is gargantuan. Gunning (2005: 904) cites Mises (1966: 238) quite properly discussing "the goals which most people . A man fully steeped in the niceties of Austrian economics might still reject these ends. there is no necessity for such preferences. and presumes to lecture him about the failures thereof. A complete listing of his publications in this regard would take up half the space of this entire article.org/ mnrbib. For more on value freedom from an Austrian perspective. 1997b). First. but. are intent on attaining by toiling" but this This content downloaded on Sat. 1994. 1973b. At best. again. but without a normative base. 1933. 2. It is exceedingly curious that an Austrian economist of Gunning's stature would not realize this. 3. 1977. 1957. 1990. see Rothbard (1997a: 255-265). 1978. 1982. Notes 1. For a sampling.. Mises did not succeed in defending these notions. 1999). 1997a. Mises. 1969a.mises. he states that "Rothbardargued that economics is the valuefree handmaiden of ethics" (Gunning 2005: 915-916). His major works include Mises (1912. Rothbard's entire career as an economist was predicated upon just the points made by Gunning in this section. Contrary to Gunning. was very prolific in terms of his contribution to the defense of free markets. and Rothbard'scriticism remains impregnable. at least to the attempts of Gunning to rend them asunder.. 1969b. see Rothbard (1970. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .asp. 1983. also see Block (1975). too. 1972. and not be forced to endure the pain of self-contradiction. 1971. and that socialism to the very opposite. Conclusion There are several errors committed by Gunning in his conclusion. 1976b. 1976a. and thus must favor the economic freedom that alone makes their attainment possible. 1943. why ever should the former be preferred to the latter?One can say that most people do prefer these goals. one can state that free enterprise leads to peace and prosperity. H.
My colleague Tom DiLorenzo responded to this as follows: "Basedon this quote. Gunning(2005: 904). the main goal-indeed the reason for being-of economics. twice repeated(SOME OF. 7. a government-controlled This content downloaded on Sat. only to Gunning. can have goals. It was.It is not his function trines.can have a goal. ing Rothbard As we have seen in the text accompanyingthis footnote. henceforth.Comment on Gunning 933 is a very differentthing."Yes. 4. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions .he never supplies any evidence thatthe lattersupportshis claim that economics itself.. Eshelman's article 9. Thatindividualpeople have ends is a staple of the that ecoAustrianeconomics subscribedto by both Mises and Rothbard. not essential to Rothbard's critia 'variant cism anyway. Mises.My recollectionas its then co-editor.Hoppe's (1993:204-207) [alrgument the criticisms of the socialistsagainstprivatepropcan be used to undermine erty rights. Material ALL OF) insertedby presentauthor. as opposed to pure economic theory. Myguruin matters Ebeling.Withoutthis principle. Richard 10. in bracketsin the threestatements. I shall be callingthis Statement 3. as it highlightedan aspect of as a proto naturallaw Mises that had not before been much appreciated: theorist. claimthatMisesused 6. nomics itselfcan have goals is a view thatcan be attributed StatesGunning(2005: 904-905): "Itis important to realize that Mises'sgoal of comparing ideologiesand systemswas not a side issue. . then why does Gunningspend so much time excoriatfor this "mistake.is that Rothbard delighted with the publicationof this piece. But in my opinion this phenomenon is fair game at least for students of political economy. it appears that Mises would have approvedof a division of labor whereby the politicianswould worry about corruptionand politicizationand economists would eschew these issues. In like manner. The money public choice argumentthat. as opposed to economists.Mises'sclaim is literallyunintelligible. from argument" 8. He mustcriticize to reveal personalmotives for protectingfallacies. only the unanimity principlecan be used to renderMises'sstatementscoherent. tion of the following quote from Mises:"Aneconomistmust deal with docerroneousthought. other which recollectionhas been independentlysupportedby Rothbard's was absolutely colleagues. for example.too.pointedme in the direcMisesian. in his view.not with men." If so. 5.Jeff Tuckerand David Gordon." But Gunningis in errorin this regard. as a person.An economist must face his opponents with the fictitiousassumptionthat they are guided by objective considerations only"(Mises 1978:51-52). But despite the fact that Gunningquotes liberally fromMises. Gunning(2005:909) maintains that "Rothbard's of the unanimityprinciple'is . It is interesting to note a point missed by Gunning: was published by the Review of Austrian Economics during the time period when Murray Rothbard was its editor.
15. in logic. they should either cease and desist. dence. This content downloaded on Sat. 1992. In common speech the term reductioad absurdumrefersto anythingpushed to absurdextremes. 1977d. 1977c. and thus cannot be true. dated 3/1/01).then use it to show that it contradictsitself."See this website: http://www.and Rothbard (1990). known as indirect proof or reductio ad impossibile.alcyone. North (1992). is one that proves a propositionby showing that its denial conjoinedwith otherpropositionspreviouslyprovedor acceptedleads to a contradiction. Statesthe Encyclopedia to absurdity').Krecke(1996). 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . a 'reduction see the logical and mathematical consequences of that assumption.This is particularly offensive in view of Rothbard's life. held that propereconomicswas verttfreibeit. Gunning is mistaken in his attribution to Rothbard of the view that "economicsis the handmaidenof ethics. I am gratefulto Guido Hulsmannfor urging me to emphasize that there are these two distinctpoints at issue. ment. valuefree economicsstandson its own. 12."To would purposely perverthis theories in an effort to charge that Rothbard sell books must rankhigh among the most foul affronts ever published."Very much to the contrary. 1977b.com/max/writing/essays/reductio-ad-absurdum. 1981. 1973. supra). 14. as He follows this up with another opposed to economists.A form of the reductio ad absurdum argument." 13. 1976.934 The American Journal of Economics and Sociology supply will inevitablylead to politicalbusiness cycles and other mischiefis a legitimateargumentfor politicaleconomiststo make"(privatecorresponon this. For Rothbard. or base their counsel on explicit ethical considerations. 1977a.Gunningis confusing this with Rothbard's thesis that value laden economics.should be the handmaidensof ethics.can have an "aim. Further. withoutneeding any scintillaof help from ethics. Foran antidoteto this sentiment. But he inveighedmightilyagainsteconomistsusing theirprofessional standing to urge public policies fraught with ethical considerations. I certainlyagree with DiLorenzo 11." insultof Rothbard gratuitous (2005:911): "Oneconjectures from [Rothbard's] claimthat economicsis the handmaiden of ethics thathe wanted to use economics to supporthis recent 'ethics of liberty'(Rothbard 119731 1978). 1995.see Ehrlich (1972. 1975. footnote 3. 1978. 1998). Otherwritingsthat have criticizedCoase along similarlines include Block (1977. or public policy recommendations.he maintainedthat if they wanted to adhere to proper scholarlycanons. Britannica:"(Latin: 'reduction a form of refutation or absurdconsequences followshowing contradictory ing upon premisesas a matterof logical necessity. 1982). 1974.html. 1979. 1999). which was devoted to pure scholarship. The dictionarydefines this as follows: "reductioad absurdumarguto absurdity'-we assumethe truthof a statement. Rothbard or value free (see Rothbard 1975.Cordato(1989. Gunning(2005: 910) repeatshis mistakennotion that economics.
Coase." Hamline Law Review 12. (1995). ."Journal of Political Economy 81(3): 521-565. Gunning (2005: 911) mistakenly cites this as Rothbard (1976: 104). Emphasis added by present author. "OJ. . "SubjectiveValue. Walter. (2000). " Review ofAustrian Economics 8(2): 61-126. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . "The Problem of Social Cost. Posner. References Block. "Private Property Rights." American Economic Review 65(3): 397-417. Boston. Coase." American Economist 19(Spring): 38-41. 19. Roy E. "The Deterrent Effect of Criminal Law Enforcement.. l(Spring): 63-78. (1975). (1998). and Professor Coase: A Critique of Friedman. . (2003). "Coase and Demsetz on Private Property Rights. (1972).Efficiency. Medema and Zorn. 2 (Spring): 273-292. 2(Spring): 111-115. L(2): 259-276. (1992)."Journal of Law and Economics 3(October): 1-44. (1989)."Journal of Legal Studies 3(1): 257-280. "On Value Freedom in Economics. and the Economics of Harmful Effects. "PrivateProperty Rights." Journal of Legal Studies. Economic Freedom. See also Mises ( 1990).Comment on Gunning 935 16. Coasian Property Rights and Psychic Income: A Reply to Harold Demsetz. Isaac.Moralityand Economics: Reply to Demsetz."Harvard Journal of Law and Policy 26(3): 923-995. Ronald H. Ehrlich." Journal of Libertarian Studies 1. Emphasis added by present author. . "An Economic Analysis of Legal Rulemaking. (1975). Time Passage. 2(Spring): 229-244. I owe a debt of gratitude to Gene Callahan for correcting an infelicitous phrase that appeared at this point in an earlier draft of this paper." QuarterlyJournal of Austrian Economics 3. Emphasis added by present author. (1996). . This quote actually appears in Rothbard (1976: 106). "Time Passage and the Economics of Coming to the Nuisance: Reassessing the Coasean Perspective. 18. Erroneous Interpretations. (1977). "The Deterrent Effect of Capital Punishment-A Question of Life and Death. (1974). (1973). Cordato. 17. . . (1960).'s Defense: A Reductio Ad Absurdum of the Economics of Ronald Coase and Richard Posner. "Ethics. WelfareEconomics and Externalities in an Open-Ended Universe: A Modern Austrian Perspective. with Richard A. This content downloaded on Sat." European Journal of Law and Economics 3: 265-286. 20. ." Campbell Law Review 20. Ronald H. MA: Kluwer. "Participationin Illegitimate Activities-A Theoretical and Empirical Investigation. McCloskey. .
. "Rejoinder. ." Journal of Political Economy 85(4): 741788. Elisabeth. (1982). "Law and the Market Order: An Austrian Critique of the Economic Analysis of Law. Yinger and S." Review of Austrian Economics 6(2): 3-41. Boston. Incapacitation. 86-109. The Economics and Ethics of Private Property: Studies in Political Economy and Philosophy." American Economic Review 71(3): 307-322. Beverly Hills.936 The American Journal of Economics and Sociology . "How to Be a Value Free Advocate of Laissez Faire:Ludwig von Mises's Solution. (1977e). CA: Sage. (1997)." In Ed. Ed. Patrick. . "Deterrence and Economics: A Perspective on Theory and Evidence. (2005). (1992). (1958). (1977c). "CapitalPunishment and Deterrence: Some Further Thoughts and Additional Evidence. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . Krecke. "The Market for Offenses and the Public Enforcement of Laws: An Equilibrium Analysis. . (1981). (1996). . Robert W. "On the Measurement of the Deterrent Effect of Capital Punishment and the Theory of Deterrence" (with J. . Galbraith. Journal of Legal Studies 6(1): 35-50. Review Yearbook Vol. Boston."Journal des Economistes et des Etudes Humaines 7(1): 19-37."Journal of Legal Studies 6(2). pp. (1977a). Eshelman. Hans-Hermann. J. (1978). "The Economic Approach to Crime-A PreliminaryAssessment. (1993). "Deterrence: Evidence and Inference. Hoppe. M. ."Yale Law Journal 85(3). MA:Houghton Mifflin." British Journal of Social Psychology 21: 107-120. C. (1976).John Kenneth. Larry J. . Eds." In Major Social Issues: A Multidisciplinary View. (1997). Commentaries on Law and Economics: 1997. "Fearof Deterrence-A CriticalEvaluation of the Report of the Panel on Research on Deterrent and Incapacitative Effects. (1977b). pp. 86-108. Gunning. . and Deterrence. "On the Usefulness of Controlling Individuals: An Economic Analysis of Rehabilitation. Robert W. Cutler. "The Deterrent Effect of Capital Punishment: Reply. MA: Kluwer. McGee. "Law and the Market Order: An Austrian Critique of the Economic Analysis of Law." In Criminology. Commentaries on Law & Economics. Gibbons). Messinger and Bittner."American Journal of Economics and Sociology 64(3): 901-918." YaleLawJournal 85(2): 209-227. . (1977d). Eds. This content downloaded on Sat. "Ludwig von Mises on Principle. TheAffluent Society." American Economic Review 67(3): 452-458. McGee. New York: Free Press. (1979). 1.
" American Economist 17(Spring). "Economic Calculation in the Socialist Commonwealth. Kansas City. (1969b). Toward a Reconstruction of Utility and Welfare Economics. "Value Implications of Economic Theory. (1990). AL: Mises Institute. Menlo Park. . The Netherlands: Kluwer Academic Publishers. Dolan. (1978). (1970). New York: New York University Press. New Haven. "Epistemological Relativism in the Sciences of Human Action. New York: Foundation for Economic Education. Theory and History." In Economics and the Environment: A Reconciliation." In TheEconomics of Ludwig von Mises. Money. Human Action. Hayek. (1973b). Property Rights. TX: Institute for Christian Economics. L. Kansas City. Tyler. W. Trans. (1983). North. NY: Arlington House. South Holland. reprinted in Richard Ebeling. Method and the Market Process. "Law. The Coase Theorem. (1999). R. ." Economica 10(August): 251-252. New Rochelle. Ludwig von. Occasional Paper #3. (1975). E. A. J." In Ed. This content downloaded on Sat. Ed. CollectivistEconomic Planning. (1972). "Why be Libertarian?" Abolitionist December. San Francisco. Rothbard. State and Economy. (1976a). CT: Yale University Press. Power and Market: Government and the Economy. Ed. Leland Yeage. (1982). (1990). NJ: Kelley. The Theoryof Money and Credit. (1943). (1971).New York: New York University Press. W. . (1978). and Air Pollution. The Anti Capitalistic Mentality.: Institute for Humane Studies. (1992). Moss. and Public Policy. MO: Sheed and Ward. ( 1975). ( 1971). NJ: Van Nostrand. IN: Liberty Fund. Notes and Recollections. S. F. Value Judgments. Ed. Helmut Schoeck and J. (1973a). "Ludwig von Mises and Economic Calculation Under Socialism. Essays by Ludwig von Mises. Nation. "Praxeology. IL: Libertarian Press. Murray N." In Anarchism: Nomos XIX Eds. Wiggins. Vancouver: Fraser Institute. South Holland. (1957). "'Elastic Expectations' and the Austrian Theory of the Trade Cycle. 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . Eds. (1969a). G. Pennock. CA: Center for LibertarianStudies. Gary." In Relativism and the Study of Man. Ed. Princeton. (1961). New York: Macmillan. American Economist 19(Spring): 35-39. "Society Without a State. W. New York: New York University Press. (1977). Clifton. MO: Sheed and Ward. Chapman. For a New Liberty. Socialism.Comment on Gunning 937 Mises. (1976b). Auburn. The Ethics of Liberty. . and J. Block. ." In The Foundations of Modern Austrian Economics. Bureaucracy. IL: LibertarianPress. CA. Indianapolis.
This content downloaded on Sat. Zorn." European Journal of Law and Economics 3: 287-289. Economic Tbought Before Adam Smith: An Austrian Perspective on the History of Economic Tbought. . Hants. . UK: Edward Elgar. AL: Mises Institute. David J. (1996). 12 Jan 2013 17:13:38 PM All use subject to JSTOR Terms and Conditions . Auburn.938 The American Journal of Economics and Sociology . Hants. The Case Against the Fed. Classical Economics: An Austrian Perspective on the History of Economic Thought. (1997a). "Defending Coase Against False Charges: A Comment on Block. (1994). UK: Edward Elgar. (1997b).