Book Reviews

Sticking to Dr. Carson's funda mental message, variants of it are spotted in epigrammatic form throughout his long text. "Men," he says at one point, "have been taught to take their eyes away from the nature of things and to focus upon the purported object or end for which an act has been performed. They have been taught that it is the motive that counts, not the consequences of the act. ..." At another point he con demns our thinkers and artists for ignoring "the principles of human action, the essentials of artistic or economic production, human na ture, and the conditions of lib erty." In another passage he chas tises our "reformers" for imagin ing they are "gods or demigods who could create a reality out of their dreams of it. It turns out that they were only men. It is small wonder that those who feel £)9 60 THE FREEMAN January deepest should turn upon man, then, and describe him as so con temptible."

Philosophical Relativism The first "reality" to be desert ed in point of time was "the West ern tradition of philosophy" which ever since Plato and Aristotle had accepted the "central insight" that "there is an enduring,' even an eternal, reality." Commenting on our abandonment of our Western heritage, Dr. Carson observes that if we do not believe that enduring principles can be discovered, there is little need for education. Any man's guess is as good as the next man's. The lesson of history is that history has no lessons. Good and bad become hopelessly rela tive; a society can make anything good by simple majority vote. Dr. Carson traces the shambles that "relativity" has made of all of our socalled disciplines with a keen eye for the ridiculous. If there is no enduring truth, how can there be any science? Why should we have a Constitution? Why not legislate utopia tomor row? Why bother with the sub ject of economics, which "has to do with the frugal management of time, ·energy, resources, and materials so as to bring about the greatest increase in the supply of the goods and services most de sired" ? "Melioristic economics"

assumes plenty, not scarcity and where there is "plenty" to be grabbed, the politician who seizes it for redistribution must, for the short run at least, see-m very much like a "god or demigod." The trouble is that the "short run" considerations presuppose that a nation can live by consuming its capital, and this brings us back to "reality" with a thud. War on the Poor The reformer's "flight from re ality" in economics is part and parcel of the "war on the poor" that has been coveTed by Dr. Car son in another notable book as well as in chapters of the present work. People are hungry, so the reformer begins by legislating crop restrictions. There is unem ployment, so we have minimum wage laws that keep you from hir ing household help at a rate that you can afford to pay. Goods on the merchants' shelves come at high prices, so why not have price supports and make the goods un available to those who cannot af ford them? If you lack purchasing power, let the government inflate the currency. This will increase the supply of money, not the sup ply of goods, so you'll not get any thing more for having had the worth of your dollar cut by 30 per cent in ten years. It's all as crazy as Dr. Carson describes it. But the n· [CHI By CLARENCE B. CARSON 568 pages $5.00 cloth, $2.50 paper (Quantity discounts available) The book is somewhat updated from the series carried earlier in The Freeman. These are samplings of reader responses: '"-' "I want to tell you that I greatly appre ciate your series of articles on The Flight from Reality . ... I trust these will be pub lished in book form in the near future ...

such a book should be required reading for every student in our colleges." - NEW HAMPSHIRE '"-' "Your Flight from Reality series has been so penetrating, so irresistibly logical and so trenchant that I do hate to see it come to an end." -PENNSYLVANIA '"-' "Almost like an adolescent pursuing a 'thriller' to the last page, I have been intoxi cated with each succeeding installment of The Flight from Reality. Now that I have regretfully reached the last page, I am writ ing to thank you for this brilliant piece of analysis. I shall read and reread it for many years." -NEW YORK CITY '"-' "Have completed reading The Flight from Reality and I still say it's simply great!" -COLORADO ,....- "Yours is the most logical, lucid, and meticulous explanation of the problem sur rounding America .... " -OHIO '"-' "You are to be congratulated on the depth and accuracy of your analysis and synthesis in The Flight from Reality."

-CALIFORNIA ,......- "I have just finished reading the last in stallment of your Flight from Reality . ... I have reread each installment several times. .. . You have put together a monumental work. I hope it gets the attention it deserves." -MARYLAND ,......- "Please accept my congratulations on 'The Pen and the Sword,' the last chapter of The Flight from Reality. I'm looking for ward to the publication of the complete book." -VIRGINIA ,......- "The September issue of THE FREE MAN was received in today's mail and I felt called upon to express my appreciation to you· and the editors for affording me the opportunity of studying your splendid series on The Flight from Reality." -NEW YORK ,......- "Your uncompromising libertarian posi tion combined with your great scholarship make your articles among the very best ever written. The service you are rendering to in dividualliberty is tremendous." -ARKANSAS ,......- "I commend you for and admire your ability to comprehend broad subjects and to translate that comprehension into straight forward, easy-to-understand language. Your Flight from Reality is an outstanding ex ample of this ability." -WISCONSIN ORDER FROM: THE FOUNDATION FOR ECONOMIC EDUCATION IRVINGTON-ON-HUDSON, NEW YORK 10533 62 THE FREEMAN January Square Deal, the New Deal, the Fair Deal, the New Frontier, and the Great Society were all dedi cated to the idea that government intervention in behalf of augment ing craziness would raise every body's standard of living. If we hadn't been blessed with technolo gists who could find ways of cut ting the cost of making and dis tributing goods in spite of crop restrictions, minimum wage laws, and inflation, we would have been dead of "meliorism" long ago.

One of Dr. Carson's best chap ters is the one called "The Flight from the Constitution." The Con stitution protects "speech, the press, and religion" absolutely. But "life, liberty, and property" can be taken away by "due proc ess of law." There are two meth ods of taking property that are sanctioned by the Constitution: by taxation and by exercising the right of eminent domain. The tax ing power is limited by the re quirement that taxes be levied for "the common defense and general welfare, and that some of them be uniform throughout the United States." As for "eminent domain," it can only be exercised when "just compensation is paid" for something taken for "public use." Departures from the Constitution All of this is, or should be, very clear. But Dr. Carson notices that the power to regulate commerce is used to take property from people. The minimum wage law is confis catory, a violation of the due, proc ess clause of the Constitution. The Sixteenth Amendment gives Con gress the power to "lay and collect taxes on incomes from whatever source derived, without apportion ment among the several States, and without regard to any census or enumeration."

But this does not "authorize" a graduated income tax, which would seemingly be outlawed by the Constitutional guarantee of "equal protection of the laws." If spinster Vivien Kellems has a good Constitutional point when she argues that she is being denied "equal protection" when the Treas ury taxes her at a higher rate than it taxes married women, why haven't we all a valid case against the government when it distin guishes between high bracket dol lars and low bracket dollars? The millionaire doesn't get the same protection for his dollar of income that is accorded to less fortunate mortals. Nobody cares very much about the millionaires, but it hap pens to be their Constitution, too, And how about the nineteen-year old who is drafted by the militar~ and sent to fight in an undeclarec war? His body is seized, and hE is compelled to labor at a tasl which he has not freely chosen 1970 THE FLIGHT FROM REALITY 63 This is, "slavery" by any defini tion, and it happens despite the Thirte'enth Amendment, which specifically prohibits "involuntary servitude, except for the commis sion of a crime."

Conflict Instigated By assuming the right to seize property and redistribute it de spite the Constitutional guaran tees about "due process" and "equal protection of the laws," the government has turned the U.S. into a "class society." Men have been set against men, and groups against groups. As Dr. Carson says, a man may be: a husband, a father, a son, a deacon in his church, a Mason, a golfer, a prop erty owner, a debtor, a creditor, a consumer, a seller, a hunter, and an army veteran, but if he thinks of himself as "labor" he will not be acting as a "whole man." By "politicalizing" the struggle for income, society is not only cut apart, it is rendered im potent. The Flight from Reality is such a wide-ranging book that review ing it is like reviewing a whole literature. I feel that I have done it only the most cursory sort of justice. I wish I could find some way of persuading every college freshman to read it, and to throw its contents in the face of his pro fessors in economics, law, literature, history, and philosophy for the four years of his undergradu ate life.

~ THE HISTORICAL SETTING OF THE AUSTRIAN SCHOOL OF ECONOMICS by Ludwig von Mises (New Rochelle, New York: Arlington House, 1969, 47 pp., $1) Reviewed by Tommy JV. Rogers THE IMPORTANCE of this book is not to be measured by its size. Von Mises ranges far beyond a chronological account of the de velopment of important men and works in the Austrian School; he goes beyond an era history..,.... though he provides this in reveal ing fashion - showing the organi zational .support, social influence, and status of German and Aus trian universities and their inter action with the social structure. He touches on the study and uses of philosophy, epistemology, and history as they relate to liberty and its corollary requirements of openness to free enterprise and the free flow of ideas. We have here an. enlightening venture into the sociology of knowledge, or the social context in which ideas de velop and do or do not take root.

What was to become known as the Austrian School can be traced to the publication of Karl Meng er's Grundsatze der Volkswirt64 THE FREEMAN January schaftslehre in. 1871. His two earliest followers were Eugen von Bohm-Bawerk and Friedrich von Wies.er. They, and some younger men who had been taught by Wieser, contributed to the econom ic theory of marginal utility. The pejorative term "Austrian School" was applied only when their an tagonism to the German historical school came into the open in the 1880's. Even in Austrian uni versities. (for reasons which Mises explains) those whom the world styled the "Austrian economists" were somewhat reluctantly tolerat ed outcasts. The hostility that the teachings of classical economic theory re ceived on the continent was pri marily caused by political predis positions. Political economy as de veloped by several generations of English thinkers (of whom Adam Smith, David Ricardo, Thomas R.

Malthus, and J. S. Mill are repre sentative) was the most exquisite outcome of the philosophy of the Enlightenment, containing the gist of the liberal doctrine that aimed at the establishment of represent ative government recognizing the equality of all individuals under law. Most of the nineteenth century's progressive politicians who advo cated representative government were guided by the optimistic illu sion of democratic infallibility founded on a double faith in the goodness of man and his rational mind. The arguments brought for ward by the small group of lib erals known as the Austrian econ omists did not imply any refer ence to an alleged infallibility of majorities. The rationale of repre sentative government, Mises points out, is not that majorities are God like and infallible. "It is the intent to bring about by peaceful meth ods the ultimately unavoidable ad justment of the political system and the men operating its steering mechanism to the ideology of the majority." These true liberals rec ognized that the only economic system which assures a steadily progressive· improvement in man's welfare can work only in an at mosphere of "undisturbed peace."

They advocated government by the people's elected representatives.be cause they took it for granted that only this system will lastingly pre serve peace in domestic and for eign affairs. Today, however, the reaction of "statism and socialism is sapping the foundations of Western civili zation and well-being." "But," Mises adds, "truth persists and works, even if nobody is left tc utter it." I the Freeman VOL. 20, NO.2. FEBRUARY 1970 Emblem of Freedom A legend of Freedom - and how it can be lost. George F. CahUi 67 Inflation:A Tiger by the Tail Henry Hazlitt 70 Like a drug, increasing doses are required for a given "high" feeling, with demoralizing consequences; withdrawal may be agonizing. Inflation:What It Means William B.Boyd 80 A businessman decides to combat inflation by discussing it with the young folks. The InvisibleHand Rosalie Nichols 85 The law of supply and demand has been violated - but never repealed.