Vienna

For many centuries, Vienna had been the administrative center of the Habsburg Empire. After the revolution of 1848–1849 and Franz Joseph's abortive attempt to reintroduce royal absolutism, the Austrian liberals had risen to power at the end of the 1850s. Their reign lasted about thirty years, enough time to reshape the city to reflect their ideals. They demolished the ramparts that separated the old city of Vienna from the surrounding suburbs, replacing them with the Ringstrasse, a magnificent U-shaped boulevard that now enclosed the old center from three sides; the fourth border was an arm of the Danube River. The Ringstrasse became an architectural and aesthetic triumph which “by virtue of its geographical concentration, surpassed in visual impact any urban reconstruction of the nineteenth century—even that of Paris.”¹ The nobility too had its palaces on the new boulevard, but the dominant edifices embodied the liberal bourgeoisie's political and cultural values. On the very spot where the large city ramparts had once symbolized the military presence of monarchical rule, now an opera and a Hofburgtheater celebrated the performing arts, splendid museums for natural history and art displayed human achievements and discoveries, parliament buildings² hosted the new political forces present in the Reichsrat, new buildings for the university and the stock exchange represented the forces of economic progress, and a magnificent neo-Gothic city hall symbolized the rebirth of municipal autonomy after ages of imperial supremacy.

Young Mises could reach all of these places within a twenty-minute walk. Unlike most other major European capitals, the city of Vienna was surprisingly small.³ It hosted all central political institutions and administrations, the most important cultural centers, and the headquarters of the largest corporations of the entire empire, but one could walk across the entire concentration in a half-hour's stroll.⁴

It was easy to encounter the empire's most famous and powerful people on the streets of Vienna. It was almost impossible not to see someone in some eminent position. Among the most popular individuals were opera singers, stage actors, and members of the royal family. When a famous singer walked by, or one of the more than sixty archdukes or archduchesses drove by in their carriage, people would greet them with spontaneous applause. And when a star from the opera or Hofburgtheater died, flags flew at half-mast.⁵ Yet the best example—and almost unbelievable for us today—was Franz Joseph himself, who frequently departed in just his carriage from the Hofburgtheater in the city to Schönbrunn Palace on the outskirts of Vienna. Anyone could walk within reach of the carriage and lift his hat to the white-haired emperor.

Vienna 1858

It was similarly impossible not to meet one's friends, relatives, and colleagues on the way to or from the office, shop, or school. It was in the cafés that the Viennese exchanged ideas, discussed events, debated issues, but they were already acquainted with one another just by walking from home to the office, by going to the opera, or to the museums.

The Viennese cultural elites did not live in secluded social circles. They perceived themselves as taking part in an all-encompassing social life that brought together ministers and students, opera singers and scientists, stock brokers and historians of art, philosophers and painters, psychologists and novelists, office clerks and architects, and so on in countless variations. Having so many people in so small a city contributed to making Vienna—from the 1870s to the 1930s—a cultural hothouse that would shape much of what was most valuable in twentieth-century civilization. In those years Vienna became the birthplace of phenomenology, medicine, psychoanalysis, Zionism, and Jugendstil (art nouveau). It was one of the cradles of modern analytical philosophy and, most importantly, it was the birthplace and home of Austrian economics—that school of thought that Ludwig von Mises was to lead and transform. In the words of cultural historian Carl Schorske:

In London, Paris, or Berlin... the intellectuals in the various branches of high culture, whether academic or aesthetic, journalistic or literary, political or intellectual, scarcely knew each other. They lived in relatively segregated professional communities. In Vienna, by contrast, until about 1900, the cohesive-ness of the whole élite was strong. The salon and the café retained their vitality as institutions where intellectuals of different kinds shared ideas and values with each other and still mingled with a business and professional élite proud of its general education and artistic culture.⁶

The cafés had a decisive impact on the education of Vienna's young intellectuals.⁷ The café was of course a place to have coffee or a small meal, but it was also where professional people met to talk business, and everyone else met to discuss current interests. For students, the café was also an institution of learning. The better cafés subscribed to the major international journals of science, art, and literature. Designed for the entertainment of customers, these subscriptions made the cafés function as a kind of private library. As a teenager, Mises must have spent many afternoon hours here, reading the latest articles in all fields of knowledge and achievement, and discussing them with his peers. It was probably here that he first encountered the writings of the German Historical School under Gustav Schmoller and found them less then fully convincing. He later recalled:

I was still in high school when I noticed a contradiction in the position of the Schmoller circle. On the one hand, they rejected the positivistic demand for a science of law that was to be built from the historical experiences of society; on the other hand, they believed that economic theory was to be abstracted from economic experiences. It was astonishing to me that this contradiction was barely noticed and rarely mentioned.⁸

He was equally bewildered by the way the Historical School presented its case against laissez-faire liberalism. Schmoller and his friends seemed to argue that the modern liberal era contrasted unfavorably with older collectivist times. But this made no sense:

At that time I did not yet understand the significance of Liberalism. But to me, the fact alone that Liberalism was an achievement of the eighteenth century, and that it was not known in former times, was no cogent argument against it.... It was not quite clear to me how an argument could be derived from the fact that in the distant past there had been community property in land. Nor could I understand why monogamy and family should be abolished because there had been promiscuity in the past. To me such arguments were nothing but nonsense.⁹

The sheer cultural density of the city almost forced the Viennese to take an interest in science, beauty, and art. Thinking and talking about such things were not reserved for the elite or particular occasions. They were a part of Vienna's daily common life. Virtually everybody, from the emperor to the housewife, knew something about the latest achievements of science and held some opinion about this actor or that novel. In fact, any kind of culinary, artistic, scientific, or technological achievement met with well-informed appreciation and critique. This permanent criticism—the famous Viennese granteln—sharpened everyone's minds and attained standards virtually without equal.

While the Viennese were interested in all fields of endeavor and refinement, what they were truly enthusiastic about was music. From about 1770 to 1810, they had witnessed the most extraordinary explosion of musical creation the world has ever experienced, when the geniuses of Haydn, Mozart, Beethoven, and Schubert burst onto Vienna's stages in rapid succession.¹⁰The city on the Danube became the world capital of music and remained so into the twentieth century. Passion for music united all ethnic, social, and political strata of the population. Differences that made them opponents in politics could not separate them when it came to enjoying old and new masters in music. And in distinct contrast to politics, where irreconcilable worldviews seemed to rule out any objective standards and true expertise, a widespread consensus determined what was good and bad in music, and these musical standards were applied to the performances of the Vienna Philharmonic and of the opera without mercy. In the words of William Johnston: “Slovenliness (Schlamperei) might be tolerated in politics, but not in musical or theatrical performance.”¹¹

Mises did not share the Viennese acceptance of Schlamperei when it came to politics, but he did share their passion for music. It would endure throughout his life. His stepdaughter, Gitta Serény recalled her ninety-year-old stepfather sitting next to her at a performance of Strauss's “Blue Danube” in New York City. The old man's eyes were shining as he hummed along with the music.