Murray Rothbard

Murray Rothbard
Western Economists
20th-century Economists
(Austrian Economics)
Murray Rothbard.jpg
Rothbard circa 1955
Full name Murray Newton Rothbard
Birth March 2, 1926(1926-03-02) (Bronx, New York, United States)
Death January 7, 1995 (aged 68) (New York City, New York, U.S.)
School/tradition Austrian School
Main interests Economics, Political economy, Anarchism, Natural law, Praxeology, Numismatics, Philosophy of law, Ethics, Economic history
Notable ideas Founder of Anarcho-capitalism, Rothbard's law, largely influenced Agorism
Influenced by
Influenced

Murray Newton Rothbard (March 2, 1926 – January 7, 1995) was an American economist of the Austrian School who helped define modern libertarianism and founded a form of free-market anarchism he termed "anarcho-capitalism".[1][2] Rothbard took the Austrian School's emphasis on spontaneous order and condemnation of central planning to an individualist anarchist conclusion.[3]

Contents

Life and work

Rothbard was born to David and Rae Rothbard, who raised their Jewish family in the Bronx. "I grew up in a Communist culture," he recalled.[4] He attended Columbia University, where he was awarded a Bachelor of Arts degree in mathematics (1945), a Master of Arts degree (1946), and a Doctor of Philosophy degree in economics in 1956. He earned his Columbia doctorate under Arthur Burns, later the Chairman of the Federal Reserve.[5]

During the early 1950s, he studied under the Austrian economist Ludwig von Mises. He also worked for the William Volker Fund. From 1963 to 1985, he taught at New York Polytechnic Institute in Brooklyn, New York.[6] before becoming a distinguished professor at the University of Nevada, Las Vegas. He founded the Center for Libertarian Studies in 1976. He later was the academic vice president of the Ludwig von Mises Institute.

In 1953 he married JoAnn Schumacher in New York City. He died in 1995 in Manhattan of a heart attack. The New York Times obituary called Rothbard "an economist and social philosopher who fiercely defended individual freedom against government intervention."[6] William F. Buckley wrote a bitter obituary in the National Review criticizing Rothbard's radical politics.[7]

Austrian School writings

Part of a series on Libertarianism
Austrian School
 
Theoretical works
Theory
Movements
Organizations
People
Related topics
 
Portal Philosophy portal
Portal Economics portal
Part of the Politics series on
Libertarianism
Origins and history
Concepts
Schools
Topics
Related topics
 
Libertarianism portal
Philosophy portal
Politics portal
Main article: Austrian School

The Austrian School attempts to discover axioms of human action (called "praxeology" in the Austrian tradition). It supports free market economics and criticizes command economies because they destroy the information function of prices and inevitably leads to totalitarianism. Influential advocates were Eugen von Böhm-Bawerk, Friedrich Hayek and Ludwig von Mises. As a trained economist, Murray Rothbard attempted to meld Austrian economics with classical liberalism and individualist anarchism, and is credited with coining the term "anarcho-capitalism". Rothbard argued that the entire Austrian economic theory is the working out of the logical implications of the fact that humans engage in purposeful action.[8]

Rothbard also was knowledgeable in history and political philosophy. Rothbard's books, such as Man, Economy, and State, Power and Market, The Ethics of Liberty, and For a New Liberty, are considered by some to be classics of natural law libertarian thought. He studied the pre-Adam Smith economic schools, such as the Scholastics and the Physiocrats and discussed them his unfinished, multi-volume work, An Austrian Perspective on the History of Economic Thought.

Rothbard divides the various kinds of state intervention in three categories: autistic intervention, which is interference with private non-exchange activities; binary intervention, which is forced exchange between individuals and the state; andtriangular intervention, which is state-mandated exchange between individuals. According to Sanford Ikeda, Rothbard's typology "eliminates the gaps and inconsistencies that appear in Mises's original formulation."[9]

Rothbard was an ardent critic of the influential economist John Maynard Keynes and Keynesian economic thought. His essay Keynes, the Man,[10] is an attack upon Keynes' economic ideas and personage.

Rothbard was also severely critical of, among others, utilitarian philosopher Jeremy Bentham in his essay, "Jeremy Bentham: The Utilitarian as Big Brother" published in his work, Classical Economics.

Murray Rothbard devotes a chapter of Power and Market to the traditional role of the economist in public life. Rothbard notes that the functions of the economist on the free market differ strongly from those of the economist on the hampered market. "What can the economist do on the purely free market?" Rothbard asks. "He can explain the workings of the market economy (a vital task, especially since the untutored person tends to regard the market economy as sheer chaos), but he can do little else."[11][12]

Anarcho-capitalist views

Part of the
Philosophy series on
Anarchism
"Circle-A" anarchy symbol
Schools
Theory · Practice
Issues
History
Culture
Economics
By region
Lists
Related topics
 
Anarchism portal
Philosophy portal
Politics portal
Main article: Anarcho-capitalism

Capitalism is the fullest expression of anarchism, and anarchism is the fullest expression of capitalism.

—Murray Rothbard[13]

Rothbard "combined the laissez-faire economics of his teacher [Ludwig Von Mises] with the absolutist views of human rights and rejection of the state he had absorbed from studying the individualist American anarchists of the nineteenth century such as Lysander Spooner and Benjamin Tucker."[14] Of Spooner and Tucker, Rothbard wrote:

“ Lysander Spooner and Benjamin T. Tucker were unsurpassed as political philosophers and nothing is more needed today than a revival and development of the largely forgotten legacy they left to political philosophy … There is, in the body of thought known as 'Austrian economics', a scientific explanation of the workings of the free market (and of the consequences of government intervention in that market) which individualist anarchists could easily incorporate into their political and social Weltanschauung.[15] ”

Like the nineteenth century individualists, he believed that security should be provided by multiple competing businesses rather than by a tax-funded central agency.[16] However, he rejected their labor theory of value in favor of the modern neo-classical marginalist view. Thus, like most modern economists, he did not believe that prices in a free market would, or should be, proportional to labor (nor that "usury" or "exploitation" necessarily occurs where they are disproportionate). Instead, he believed that different prices of goods and services in a market, whether completely free or not, are ultimately the result of goods and services having different marginal utilities rather than containing differing amounts of labor - and that there is nothing unjust about this. Rothbard also disagreed with Tucker that interest would disappear with unregulated banking and money issuance. Rothbard believed that people in general do not wish to lend their money to others without compensation, so there is no reason why this would change where banking is unregulated. Nor did he agree that unregulated banking would increase the supply of money, because he believed the supply of money in a truly free market is self-regulating, and he believed that it is good that it would not increase the supply or inflation would result.[17]

Rothbard said he was "strongly tempted to call [himself] an “individualist anarchist," except he believed that "Spooner and Tucker have in a sense preempted that name for their doctrine and that from that doctrine I have certain differences." Instead, he called his philosophy "anarcho-capitalism", though Kevin Carson notes that few contemporary individualist anarchists retain a belief in the labor theory of value, and that "most people who call themselves 'individualist anarchists' today are followers of Murray Rothbard's Austrian economics."[18] Anarcho-capitalist Wendy McElroy, for example, refers to herself as a "Rothbardian and an individualist anarchist."[19]

Cover of the 2004 edition of Man, Economy, and State.

Rothbard described the moral basis for his anarcho-capitalist position in two of his books: For a New Liberty, published in 1972, and The Ethics of Liberty, published in 1982. In his Power and Market (1970), Rothbard described how a stateless economy would function. He held that the difference between a state and voluntary defense is that a state taxes and it enforces a territorial monopoly, over property that it does not own (private property), on the use of defense and punitive force. Private defense relies on voluntary payments and it does not forcefully prevent other private defenders from competing for business. For example, if someone subscribed to a private police agency, and someone had broken into that person's home, then that individual could call the private police to come to the home and arrest the intruder and take him to a private jail and private court. A state claims a monopoly over such force on property that anarcho-capitalists do not believe that the state owns (e.g. the person's home); it does not permit this kind of competition, by definition.

In The Ethics of Liberty, Rothbard asserted the right of total self-ownership, as the only principle compatible with a moral code that applies to every person – a "universal ethic" – and that it is a natural law by being what is naturally best for man.[20] He believed that, as a result, individuals owned the fruits of their labor. Accordingly, each person had the right to exchange his property with others. He believed that if an individual mixes his labor with unowned land then he is the proper owner, and from that point on it is private property that may only exchange hands by trade or gift. He also argued that such land would tend not to remain unused unless it makes economic sense to not put it to use.[21] Rothbard defined the libertarian position through what is called the non-aggression principle, that "No person may aggress against anybody else." Rothbard attacked taxation as theft, because it was taking someone else's property without his consent. Further, conscription was slavery, and war was murder. Rothbard also opposed compulsory jury service and involuntary mental hospitalization.

Rothard's conception of anarcho-capitalism differed from that of others, most notably that of David D. Friedman, who advocates that law itself—and not merely defense services—be bought and sold on the market. In Rothbardian anarcho-capitalism, there would first be the implementation of a mutually agreed-upon libertarian legal code, "which would be generally accepted, and which the courts would pledge themselves to follow."[22] This legal code would recognize sovereignty of the individual and the principle of non-aggression.

Political Activism

When young, he considered himself part of the Old Right, an anti-statist and anti-interventionist branch of the U.S. Republican party. When interventionist cold warriors of the National Review, such as William F. Buckley, Jr., gained influence in the Republican party in the 1950s, Rothbard quit that group. During the late 1950s, Rothbard was an associate of Ayn Rand and her Objectivist philosophy, but later had a falling out. He later lampooned the relationship in his play Mozart Was a Red. In the late 1960s, Rothbard advocated an alliance with the New Left anti-war movement, on the grounds that the conservative movement had been completely subsumed by the statist establishment. However, Rothbard later criticized the New Left for supporting a "People's Republic" style draft. It was during this phase that he associated with Karl Hess and founded Left and Right: A Journal of Libertarian Thought with Leonard Liggio and George Resch, which existed from 1965 to 1968. From 1969 to 1984 he edited The Libertarian Forum, also initially with Hess (although Hess's involvement ended in 1971).

Rothbard criticized the "frenzied nihilism" of left-wing libertarians but also criticized right-wing libertarians who were content to rely only on education to bring down the state; he believed that libertarians should adopt any non-immoral tactic available to them in order to bring about liberty.[23]

During the 1970s and 1980s, Rothbard was active in the Libertarian Party. He was frequently involved in the party's internal politics. From 1978 to 1983, he was associated with the Libertarian Party Radical Caucus, allying himself with Justin Raimondo, Eric Garris and Williamson Evers. He opposed the "low tax liberalism" espoused by 1980 Libertarian Party presidential candidate Ed Clark and Cato Institute president Edward H Crane III. Rothbard split with the Radical Caucus at the 1983 national convention over cultural issues, and aligned himself with what he called the "rightwing populist" wing of the party, notably [[Lew Rockwell] and Ron Paul, who ran for President on the Libertarian Party ticket in 1988.

In 1989, Rothbard left the Libertarian Party and began building bridges to the post-Cold War anti-interventionist right, calling himself a paleolibertarian.[24] He was the founding president of the conservative-libertarian John Randolph Club and supported the presidential campaign of Pat Buchanan in 1992, saying “with Pat Buchanan as our leader, we shall break the clock of social democracy.”[25] However, later he became disillusioned and said Buchanan developed too much faith in economic planning and centralized state power.[26]

Rothbard's law

Cover from the first volume of the 2006 Mises Institute edition of An Austrian Perspective on the History of Economic Thought

Rothbard's law is a self-attributed adage. In essence, Rothbard suggested that an otherwise talented individual would specialize and focus in an area at which they were weaker – or simply flat out wrong. To put it more succinctly, he often said, "Everyone specializes in what he is worst at."

In one example, he discusses his time spent with Ludwig von Mises,

In all the years I attended his seminar and was with him, he never talked about foreign policy. If he was an interventionist on foreign affairs, I never knew it. This is a violation of Rothbard's law, which is that people tend to specialize in what they are worst at. Henry George, for example, is great on everything but land, so therefore he writes about land 90% of the time. Friedman is great except on money, so he concentrates on money. Mises, however, and Kirzner too, always did what they were best at. [3]

Continuing on this point,

There was another group coming up in the sixties, students of Robert LeFevre's Freedom School and later Rampart College. At one meeting, Friedman and Tullock were brought in for a week, I had planned to have them lecture on occupational licensing and on ocean privatization, respectively. Unfortunately, they spoke on these subjects for 30 minutes and then rode their hobby horses, monetary theory and public choice, the rest of the time. I immediately clashed with Friedman. He had read my America's Great Depression and was furious that he was suddenly meeting all these Rothbardians. He didn't know such things existed. [4]

Books

Cover of the Mises Institute's 2000 edition of America's Great Depression.
Books by Murray Rothbard

Man, Economy, and State (1962) • The Panic of 1819 (1962) • America's Great Depression (1963) • What Has Government Done to Our Money? (1963) • Power and Market (1970) • For a New Liberty: The Libertarian Manifesto (1973) • Egalitarianism as a Revolt Against Nature and Other Essays (1974) • Conceived in Liberty (1975-79) • The Ethics of Liberty (1982) • The Case Against the Fed (1994) • An Austrian Perspective on the History of Economic Thought (1995) • A History of Money and Banking in the United States (2005) • The Complete Libertarian Forum (2006) • The Betrayal of the American Right (2007)

Notes

  1. ↑ Miller, David, ed. (1991). Blackwell Encyclopaedia of Political Thought. Blackwell Publishing. ISBN 0-631-17944-5. 
  2. ↑ Wendy McElroy. "Murray N. Rothbard: Mr. Libertarian". Lew Rockwell. July 6, 2000..
  3. ↑ Noce, Jaime E. & Miskelly, Matthew (2002). Anarchism. Political Theories for Students (p. 7). The Gale Group, Inc.
  4. ↑ Life in the Old Right by Murray N. Rothbard
  5. ↑ North, Gary (February 28, 2004). "Ron Paul on Greenspan’s Fed", Lew Rockwell.com. 
  6. ↑ 6.0 6.1 David Stout, Murray N. Rothbard, Economist And Free-Market Exponent, 68, New York Times, January 11, 1995.
  7. ↑ William F. Buckley, Murray Rothbard, RIP - professor and Libertarian Party founder, National Review, February 6, 1995.
  8. ↑ Grimm, Curtis M.; Hunn, Lee; Smith, Ken G. Strategy as Action: Competitive Dynamics and Competitive Advantage. New York Oxford University Press (US). 2006. p. 43
  9. ↑ Ikeda, Sanford. Dyamics of the Mixed Economy: Toward a Theory of Inteventionism. Routledge UK. 1997. p. 245
  10. ↑ Full text at mises.org
  11. ↑ Why Intellectuals Still Support Socialism - Peter G. Klein - Mises Institute
  12. ↑ Chapter 7-Conclusion: Economics and Public Policy
  13. ↑ "Exclusive Interview With Murray Rothbard" The New Banner: A Fortnightly Libertarian Journal (February 25, 1972)
  14. ↑ Blackwell Encyclopaedia of Political Thought, 1987, ISBN 0-631-17944-5, p. 290
  15. ↑ "The Spooner-Tucker Doctrine: An Economist's View" [1]
  16. ↑ William Outhwaite, ed. (2002). The Blackwell Dictionary of Modern Social Thought (2nd ed.). Malden, MA: Blackwell Publishers. ISBN 0-631-22164-6. 
  17. ↑ Rothbard, Murray. The Spooner-Tucker Doctrine: An Economist's View [2]
  18. ↑ Carson, Kevin. Mutualist Political Economy, Preface
  19. ↑ McElroy, Wendy. The Passion of Ayn Rand's Critics: The Case Against the Brandens (2005)
  20. ↑ Rothbard, Murray Newton. The Ethics of Liberty. NYU Press. 2003. pp. 45 - 45
  21. ↑ Kyriazi, Harold. Reckoning With Rothbard (2004). American Journal of Economics and Sociology 63 (2), p. 451
  22. ↑ Rothbard, Murray. For A New Liberty. "12 The Public Sector, III: Police, Law, and the Courts"
  23. ↑ Lora, Ronald & Longton, Henry. 1999. The Conservative Press in Twentieth-Century America. Greenwood Press. p. 369
  24. ↑ Murrary Rothbard, "Big Government Libertarianism", Lew Rockwell.com, November 1994.
  25. ↑ Lee Edwards, The Conservative Revolution: The Movement That Remade America, Simon and Schuster, 1999, 329.
  26. ↑ Lew Rockwell, What I Learned From Paleoism, LewRockwell.com, 2002.

Further reading

External links

Austrian School economists

Carl Menger · Eugen von Böhm-Bawerk · Friedrich von Wieser · Frank Fetter · Ludwig von Mises · Benjamin Anderson · Henry Hazlitt · Friedrich Hayek · Lionel Robbins · William Harold Hutt · Ludwig Lachmann · Hans Sennholz · Murray Rothbard · Ralph Raico · Israel Kirzner · George Reisman · Walter Block · Robert Higgs · Hans-Hermann Hoppe  · Steven Horwitz · Joseph Salerno · Jeffrey Herbener · Thomas DiLorenzo · Jesús Huerta de Soto · Peter Boettke · Mark Thornton · David Prychitko · Jaroslav Romanchuk · Jörg Guido Hülsmann · Peter G. Klein · Peter Schiff · Robert P. Murphy