They Were Right; M. Skousen

I was in my early teens when the anti communist movement was at its zenith and remember seeing my uncle on TV I watched shows like I Led Three Lives and read books like John Stormer's None Dare Call It Trea son, 1. Edgar Hoover's Masters ofDeceit, and Whittaker Chambers's Witness. But despite this groundswell of concern over the threat of communism, communist sympathizers at high levels combined with Mark Skousen (http://www.mskousen.com; mskousen @aol.com) is an economist at Rollins College, Depart ment ofEconomics, Winter Park, FL 32789, a Forbes columnist, and editor of Forecasts & Strategies. His just-completed textbook, Economic Logic, is available from FEE. 55 media forces to ridicule and vilify patriotic conservatives. Most historians deplored the anticommunist movement of the 1950s and 1960s as "extremist," "paranoid," "right wing" hysteria. Accordingly, there was little credence given to this alleged vast commu nist conspiracy; reaction went rarely beyond references to McCarthyism, redbaiting, and blacklisting. They challenged the anti communists' claims that the Soviets had planted numerous agents in government, that Stalin had infiltrated the film industry as a means of promoting communist propaganda, that the Communist Party USA was a pawn of Moscow, and that the Soviet Union was a serious military threat.

They depicted the anticommunist era as an unwarranted "witch hunt" against liberal pro gressives and idealistic movie stars and a groundless attack on patriotic government officials who they say were falsely accused of espionage. They carried on a 40-year cam paign to proveAlger Hiss and Julius and Ethel Rosenberg innocent. My uncle's book so angered members of the political science and history departments at Brigham Young Uni versity that Richard D. Poll, a history profes sor, wrote a scathing critique of his "extrem ist" views on Karl Marx and communism.

56 THE FREEMAN/IDEASON LIBERTY • SEPTEMBER 1999 Mises and Socialism In those days, the economics profession also cast doubt on freemarket criticisms of social ism and the Soviet economy. Half a century earlier, Ludwig von Mises and F. A. Hayek were lone voices in charging that socialist cen tral planning could not work. According to conventional wisdom, Mises and Hayek had lost the debate with the socialists in the 1930s, and in 1985 Paul Samuelson reported in his popular textbook that the Soviet Union had grown faster than any other industrial econo my since the 1920s. As late as 1989, Samuel son claimed that "The Soviet economy is proof that, contrary to what many skeptics had earlier believed, a socialist command econo my can function and even thrive."2 But then, following the collapse of the Berlin Wall and Soviet communism in 1989-90, economist Robert Heilbroner shocked his colleagues in the socialist world by boldly declaring that the longstanding debate between capitalism and socialism was over. "Capitalism has won," he confessed.

"Socialism has been a great tragedy this cen tury." Furthermore, Heilbroner was forced to change his mind about Mises and the debate over socialism. Following the unexpected col lapse of communism, Heilbroner admitted, "It turns out, of course, that Mises was right."3 And it wasn't long before Paul Samuelson did an about-face in his textbook, labeling Soviet central planning "the failed model." Revelations from the Soviet Archives The fall of the Soviet Union brought about another dramatic outcome that would have far-reaching effects on modern history. The Russian government opened up thousands of secret KGB files in Moscow, revealing what one historian called "stunning revelations" about espionage and the Soviet economy under Stalin. This new information has sparked a harsh reevaluation of the anticom munist movement by historians and the media. As one reviewer put it, "It's like look ing into the new edition of a book from which half the pages had previously been torn OUt."4 The KGB files prove beyond doubt that Alger Hiss, the Rosenbergs, and numerous other Americans accused of spying for the Soviets were guilty. They confirm what 1. Edgar Hoover and the House Un-American Activities Committee were saying all along: that spies reached the highest levels of the State and Treasury departments, the White House, and the Manhattan Project, and that the Communist Party USA (which had 50,000 members in World War II) got its marching orders from Moscow.5 Stalin's Economic Disaster Based on research at the Soviet archives, historian Sheila Fitzpatrick has written a pio neering account of everyday Russian life in the 1930s: "With the abolition of the market, shortages of food, clothing, and all kinds of consumer goods became endemic. As peas ants fled the collectivized villages, major cities were soon in the grip of an acute hous ing crisis, with families jammed for decades in tiny single rooms in communal apartments.

... It was a world of privation, overcrowding, endless queues, and broken families, in which the regime's promises of future socialist abun dance rang hollow.... Government bureau cracy often turned everyday life into a night mare."6What a sharp contrast to Samuelson's glowing account of the Soviet economy. After writing three books on the Soviet 'archives, historians John Earl Haynes and Harvey Klehr summed it up this way about the anticommunists: "They were right." And being right, they deserve our praise and gratitude. 0 1. Richard Gid Powers, Not Without Honor: The History ofAmer ican Anticommunism (New York: Free Press, 1995), p. 428. 2. Paul A. Samuelson and William D. Nordhaus, Economics, 13th ed. (New York: McGraw-Hill, 1989), p. 837. 3. Robert Heilbroner, "Reflections After Communism," The New Yorker, September 10, 1990, and "The Triumph of Capitalism," The New Yorker, January 23, 1989.

4. Joseph E. Persico, "The Kremlin Connection," review ?f T~e Haunted Wood: Soviet Espionage in America, by Allen Wemstem and Alexander Vassiliev, New York Times Book Review, January 3, 1999. 5. Several books have been published detailing new findings from the Russian archives, including John Earl Haynes and Harvey K.lehr's Venona: Decoding Soviet Espionage in America (New Haven: Yale University Press, 1999) and The Soviet World ofAmerican Communism (New Haven: Yale, 1998). . . 6. Sheila Fitzpatrick, Everyday Stalinism (Oxford UmversIty Press, 1999), flyleaf.