Comments on: Must a journalist listen to the true believers in Austrian economics?

By: Siddharth Singh

Siddharth Singh — Sat, 03 Jan 2009 10:28:09 +0000

Schumpeter did in fact not believe that capitalism would last forever, leave alone the Austrian view that minimal government would. Here is a link to Schumpeters views on capitalism, and its possible demise:

http://bigotblog.wordpress.com/2008/10/24/will-capitalism-end-the-post-capitalist-world/

By: Sukrit Sabhlok

Sukrit Sabhlok — Sat, 03 Jan 2009 09:50:28 +0000

The best book for an introduction to Austrian economics is titled (strangely enough), "An Introduction to Austrian Economics".

http://www.mises.org/store/Introduction-to-Austrian-Economics-An-P72.aspx

By: Justin Fox

Justin Fox — Fri, 02 Jan 2009 21:56:36 +0000

@dixieflatlineconstruct: Thanks for the offer! But I really do want to read it in German. My German's pretty good, and the prospect (however slim) of being able someday to respond to an Austrian-econ argument with, "Well, I fear that's a mistranslation of Menger," is just too appealing to pass up.

By: ehollering

ehollering — Fri, 02 Jan 2009 21:47:28 +0000

First off, I have to defend Lew and company at LRC. They say things that are certainly not mainstream, but hardly loopy given you have some perspective on their opinions. I came to the same conclusions when I first started reading LRC (willing to deal with its perceived nuttiness and condescending tone for the occasional deep insight), and confess that as I read more and more history and economics, I found myself appreciating the blog more and more.

Anyway, I think adding the Austrian Economists blog to your reader is a good first step, although I would also advise adding the Mises Institute blog. At the Austrian Economists blog, make sure you take the time to read the comments. The exchanges on that blog are really great. Also highly recommended (and this could be a huge time-saver) is the Foundation for Economic Education's Austrian economics seminars from this past summer, which they released as an audio podcast here: http://www.fee.org/seminars/austrian/

They aren't preaching to the choir at these seminars and are thus forced to explain and differentiate the Austrian perspectives and the insights that lay the ground work for their investigations.

Lastly, consider this. I don't believe there are many Austrian economists at any level or any institution that would expect you to accept their theories without fair examination. Mostly, they only seem frustrated that their work doesn't get the attention they feel it deserves (i.e. it is dismissed often without due examination). For what it's worth, I feel they are justified in their frustration.

By: taggartcomet

taggartcomet — Fri, 02 Jan 2009 20:27:13 +0000

barracho said, "Austrian economic theory is not economics, but it is politics"

I've heard a lot of people try to refute the Austrian school using all kinds of anecdotes and half-truths, but I must say you take the cake for originality!

By: leopardpm

leopardpm — Fri, 02 Jan 2009 18:37:53 +0000

barracho, I understand where you are coming from. Economics seems to be entwined with politics in almost every area. But, it is not economics which drive politics, rather the other way around. Economics is a separate and distinct science. It is a fact, with all other things being equal, that an increase in supply will tend to lower the price. This is apolitical. It is a statement and reflection on the nature of human beings and the actions they choose. What politics does is take that fact, obliterate the 'why' and then make political policy supported by a twisted version of economics. Austrian theory is apolitical as well, though many if not all Austrians also use Austrian theory as support for their political views. An Austrian writing from an economic standpoint will note that a governmental increase (or creation) of a 'minimum wage' above marginal wage levels will naturally result in increased unemployment. This is a natural cause & effect fact of human action (and reaction). The same Austrian economist might ALSO give his political opinion by saying and concluding "Therefore we should abolish the minimum wage laws" - a purely political statement and not economic. Economics is a means, usually used to a 'political end'. In regard to discovering data which do not fit a particular theory or economic law, Austrian economics is based and deduced through logic, NOT derived from historical data. Thus, any historical data which appears to conflict must mean that either (1) Variables and influences are hidden which affect the outcome, or, (2) the logic which the theory is based upon is flawed or incorrect. Austrians continually test and challenge all economic theories and predictions which helps to weed out 'bad logic'. In addition, Austrians have an obvious keen curiosity about history, noting that history is often never written about by economists, but rather by folks which interject their own personnal bias into data collected and perspectives given. Lastly, economists cannot, by nature of economics, be able to moralize about political actions or other economic action supported by economics in asserting some sort of 'objective' morality. That sounds like alot of goobly-gook, and it is, because to actually explain my meaning would take many more paragraphs. Basically, I mean to say that ethics and morality cannot be determined through economics - economics just describes cause and effect. Economics (of any flavor) does not tell me that murder is wrong, that determination is rooted in each of our moral character and value system. The reason why Austrian Economics appeals to so many Libertarians is because their moral code is supported and buttressed by the economics, as it provides an alternate argument for why 'Freedom works'.

By: barracho

barracho — Fri, 02 Jan 2009 17:54:00 +0000

I'll be more straightforward for the benefit of my detractors:

Economics is politics by means of mathematics.

Austrian economic theory is not economics, but it is politics.

Because it is politics, every conclusion is gerrymandered from the available facts, thus allowing you to predict "findings" ahead of time. There is no risk an Austrian economist will come across data with which his theory will not reconcile.

Bet on it.

They're no worse than the rest, tho.

By: taggartcomet

taggartcomet — Fri, 02 Jan 2009 11:52:06 +0000

So, in other words, you are unwillingly to look into Austrian Economics. Wouldn't it have just been easier to admit that than to write an entire column pretending to understand something you (obviously) do not?

No wonder TIME magazine is becoming increasingly irrelevant. As long as the cheap joke continues to be substituted for "journalism" and your hack research on Austrian Economics passes for intrepid reporting it won't be long until media dinosaurs like TIME are rendered to the dustbin of history.

Good riddance.

By: lolmises

lolmises — Fri, 02 Jan 2009 06:08:52 +0000

I'm sure if you kept a journailistically open mind you would have found the dozens of times writers at mises.org were ahead of the curve on the housing situation. Not to mention the great track record of Peter Schiff. Your readers might be interested in his commentary in 2006 where he was made fun of for predicting gloom in the housing market. http://www.youtube.com/watch?v=A92VUmEw-gU

By: dixieflatlineconstruct

dixieflatlineconstruct — Fri, 02 Jan 2009 05:20:43 +0000

I'm not sure barracho meant to comment on this blog. Maybe he got confused.

Austrians are the classic liberal champions of those hurt by socialism and fascism. Austrians are for equality of opportunity, and the right to own property, which is a necessary component of class movement. Typically people improve their economic and social conditions by accumulating capital. Government welfare ruins this incentive system, by creating a permanently dependent underclass.

Poor people don't need a handout. They need liberty and opportunity.