Mises vs. Mises: The Death of Socialism

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The most influential thing that Ludwig von Mises (1881-1973) ever wrote was a brief article in 1920 on socialist economic calculation.

He argued that socialist central planning is impossible, because without a system of free markets, nobody knows what anything costs, and therefore nobody knows what anything is worth.

That argument convinced a whole generation of young men to abandon socialism. F. A. Hayek was one of them. Wilhelm Roepke was another. There were dozens of them, and for a time they became pioneers of Austrian school economics. But, one by one, they abandoned the position. There were various reasons, but none of the recruits of the early 1920s remained a supporter by 1950. Hayek stuck with more of it than most of them did and so did Roepke. They ceased to be Austrian school economists.

In 1950, Mises gave a lecture, and that lecture became an article. The article was widely read in Misesean circles, which were outside of academia. It was a great article. It had a great title. In fact, it probably was best title he ever came up with. It was even a great marketing title. Here was the title: “Middle-of-the-Road Policy Leads to Socialism.”

The article was published in a collection of articles written by Mises and collected by Mises: Planning for Freedom. It was published in 1952. It was the most effective book Mises ever wrote in terms of getting his ideas across to laymen. The lectures were easy to understand, and the book sold pretty well. I am not saying it was his greatest book, but I think it is probably the best book for somebody with no training in economics to be introduced to Austrian school economics. The Mises Institute makes available both the book and the article.

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