Everything about Murray Rothbard totally explained
Murray Newton Rothbard (
March 2,
1926 –
January 7,
1995) was an influential
American historian,
natural law theorist,
Aristotelian and
economist of the
Austrian School who helped define modern
libertarianism. Rothbard took the Austrian School's emphasis on
spontaneous order and condemnation of
central planning to an
individualist anarchist conclusion, which he termed "
anarcho-capitalism".
Life
Rothbard was born to David and Rae Rothbard, who raised their
Jewish family in the Bronx. "I grew up in a Communist culture," he recalled. He attended
Columbia University, where he was awarded a
Bachelor of Arts degree in mathematics (1945), a
Master of Arts degree (1946), and a
Doctor of Philosophy degree in economics in 1956. On
16 January 1953, he married
JoAnn Schumacher in
New York City.
In the course of his life, Rothbard was associated with a number of political thinkers and movements. During the early 1950s, he studied under the
Austrian economist
Ludwig von Mises, along with
George Reisman. Then he began working for the
William Volker Fund. During the late 1950s, Rothbard was an associate of
Ayn Rand and
Nathaniel Branden, a relationship later lampooned in his unpublished play
Mozart Was a Red. In the late 1960s, Rothbard advocated an alliance with the
New Left anti-war movement, on the grounds that the conservative movement had been completely subsumed by the statist establishment. However, Rothbard later criticized the New Left for not truly being against the draft and supporting a "People's Republic" style draft. It was during this phase that he associated with
Karl Hess and founded with
Leonard Liggio and George Resch, which existed from 1965 to 1968. From 1969 to 1984 he edited
The Libertarian Forum, also initially with Hess (although Hess' involvement ended in 1971). In 1977, he established the
Journal of Libertarian Studies, which he edited until his death in 1995.
During the 1970s and '80s, Rothbard was active in the
Libertarian Party. He was frequently involved in the party's internal politics: from 1978 to 1983, he was associated with the Libertarian Party Radical Caucus (later reorganized as the
Rothbard Caucus), allying himself with
Justin Raimondo and
Williamson Evers, and opposing the "low tax liberalism" espoused by 1980 presidential candidate
Ed Clark and
Cato Institute president
Edward H Crane III. He split with the Radical Caucus at the 1983 national convention, and aligned himself with what he called the "rightwing populist" wing of the party, notably
Ron Paul, who ran for President on the LP ticket in 1988. In 1989, Rothbard left the Libertarian Party and began building bridges to the post-
Cold War right. He was the founding president of the conservative-libertarian
John Randolph Club and supported the presidential campaign of
Pat Buchanan in 1992. However, prior to his death in
Manhattan of a
heart attack, Rothbard had become disillusioned with the Buchanan movement.
In addition to his work on economics and political theory, Rothbard also wrote on economic history. He is one of the few economic authors who studied the pre-
Adam Smith economic schools, such as the
Scholastics and the
Physiocrats. These are discussed in his unfinished, multi-volume work,
An Austrian Perspective on the History of Economic Thought.
Rothbard opposed what he considered the overspecialization of the academy and sought to fuse the disciplines of economics, history, ethics, and political science to create a "science of liberty," as reflected in his many books and articles. His approach was influenced by the arguments of Ludwig von Mises in such books as
Human Action and
Theory and History that the foundations of the social sciences are in a logic of human action that can be known prior to empirical investigation. Rothbard sought to use such insights to guide historical research, especially in his work on economic history, but also in his four-volume history of the
American Revolution,
Conceived in Liberty.
He was the academic vice president of the
Ludwig von Mises Institute and the
Center for Libertarian Studies (which he founded in 1976), was a distinguished professor at the
University of Nevada, Las Vegas, and edited the
Rothbard-Rockwell Report with
Lew Rockwell.
The Austrian School
The Austrian School of economics was founded with the publication of
Carl Menger's 1871 book
Principles of Economics. Members of this school approach economics as an
a priori system like logic or mathematics, rather than as an empirical science like geology. It attempts to discover axioms of human action (called "
praxeology" in the Austrian tradition) and make deductions therefrom. Some of these praxeological axioms are:
» *Humans act purposefully.
*Humans prefer more of a good to less.
» *Humans prefer to receive a good sooner rather than later.
*Each party to a trade benefits
ex ante.
Even in the early days, Austrian economics was used as a theoretical weapon against socialism and statist socialist policy.
Eugen von Böhm-Bawerk, a colleague of Menger, wrote one of the first critiques of socialism ever written in his treatise
The Exploitation Theory of Socialism-Communism. Later,
Friedrich Hayek wrote
The Road to Serfdom, asserting that a
command economy destroys the information function of prices, and that authority over the economy leads to
totalitarianism. Another very influential Austrian economist was
Ludwig von Mises, author of the praxeological work
Human Action.
Murray Rothbard, a student of Mises, attempted to meld Austrian economics with classical liberalism and individualist anarchism, and is credited with coining the term "anarcho-capitalism". He was probably the first to use "libertarian" in its current (U.S.) pro-capitalist sense. He was a trained economist, but also knowledgeable in history and political philosophy. When young, he considered himself part of the
Old Right, an anti-statist and anti-
interventionist branch of the
U.S. Republican party. When interventionist
cold warriors of the
National Review, such as
William F. Buckley, Jr., gained influence in the Republican party in the 1950s, Rothbard quit that group and formed an alliance with
left-wing antiwar groups. Later, Rothbard was an early supporter of the U.S. Libertarian Party, despite initially opposing it on grounds that it was premature. In the late 1950s, Rothbard was briefly involved with
Ayn Rand's
Objectivism, but later had a falling out. Rothbard's books, such as
Man, Economy, and State,
Power and Market,
The Ethics of Liberty, and
For a New Liberty, are considered by some to be classics of natural law libertarian thought.
Rothbard divides the various kinds of state intervention in three categories:
- autistic intervention, which is interference with private non-exchange activities
- binary intervention, which is forced exchange between individuals and the state
- triangular intervention, which is state-mandated exchange between individuals.
According to
Sanford Ikeda, Rothbard's typology "eliminates the gaps and inconsistencies that appear in Mises's original formulation."
Rothbard argued that the entire Austrian economic theory is the working out of the logical implications of the fact that humans engage in purposeful action.
Anarcho-capitalism
"Capitalism is the fullest expression of anarchism, and anarchism is the fullest expression of capitalism." |
Rothbard was "a student and disciple of the Austrian economist Ludwig von Mises, [who] combined the laissez-faire economics of his teacher with the absolutist views of human rights and rejection of the state he'd absorbed from studying the individualist American anarchists of the nineteenth century such as
Lysander Spooner and
Benjamin Tucker." Rothbard said: Like the nineteenth century individualists, he believed that security should be provided by multiple competing businesses rather than by a tax-funded central agency. However, he rejected their
labor theory of value in favor of the modern neo-classical
marginalist view. Thus, like most modern economists, he didn't believe that prices in a free market would, or should be, proportional to labor (nor that "usury" or "exploitation" necessarily occurs where they're disproportionate). Instead, he believed that different prices of goods and services in a market, whether completely free or not, are ultimately the result of goods and services having different
marginal utilities rather than the fact they contain differing amounts of labor - and that there's nothing unjust about this. Rothbard also disagreed with Tucker that interest would disappear with unregulated banking and money issuance. Rothbard believed that people in general don't wish to lend their money to others without compensation, so there's no reason why this would change where banking is unregulated. Nor, did he agree that unregulated banking would increase the supply of money because he believed the supply of money in a truly free market is self-regulating. And, he believed that it's good that it wouldn't increase the supply or inflation would result. Rothbard said he was "strongly tempted to call [himself] an “individualist anarchist," except he believed that "Spooner and Tucker have in a sense preempted that name for their doctrine and that from that doctrine I've certain differences." So, he chose to call his philosophy "anarcho-capitalism." However, today, the term "individualist anarchism" has in fact not been preempted by the nineteenth century individualists, because a wide range of scholars do say that anarcho-capitalism is a capitalist form of individualist anarchism. According to
mutualist,
Kevin Carson who subscribes to the old theories, few individualist anarchists still agree with the labor theory of value of the nineteenth century individualists or their theories on money, and as a result, "most people who call themselves 'individualist anarchists' today are followers of Murray Rothbard's Austrian economics." For example, anarcho-capitalist
Wendy McElroy refers to herself as a "Rothbardian and an individualist anarchist."
Anarchists who are not
individualist anarchists oppose the idea that private defense could be compatible with anarchism. It was in 1949 that Rothbard first concluded that the free market could provide all services, including police, courts, and defense services, better than could the State. Prior to this it was advocated by nineteenth century individualist anarchists such as
Benjamin Tucker, whose writings were an influence on Rothard. Prior to this it was advocated by
Gustave de Molinari who Rothbard calls the first anarcho-capitalist. Rothbard described the moral basis for his anarcho-capitalist position in two of his books,
For a New Liberty, published in 1972, and
The Ethics of Liberty, published in 1982. He described how a stateless economy would function in his book
Power and Market. According to Rothbard, the difference between a state and voluntary defense is that a state taxes and it enforces a territorial monopoly, over property that it doesn't own (private property), on the use of defense and punitive force. Private defense relies on voluntary payments and it doesn't forcefully prevent other private defenders from competing for business. For example, if someone subscribed to a private police agency, and someone had broken into that person's home, then that individual could call the private police to come to the home and arrest the intruder and take him to a private jail and private court. A state claims a monopoly over such force on property that anarcho-capitalists don't believe that the state owns (for example the person's home); it doesn't permit this kind of competition, by definition.
In
The Ethics of Liberty, Rothbard asserted the right of 100 percent
self-ownership, as the only principle compatible with a moral code that applies to every person — a "universal ethic" — and that it's a natural law by being what is naturally best for man. He believed that, as a result, individuals owned the fruits of their labor. Accordingly, each person had the right to exchange his property with others. He believed that if an individual mixes his labor with unowned land then he's the proper owner, and from that point on it's private property that may only exchange hands by trade or gift. He also argued that such land would tend not to remain unused unless it makes economic sense to not put it to use. Rothbard defined the libertarian position through what is called the non-aggression principle, that "No person may aggress against anybody else." Rothbard attacked taxation as theft, because it was taking someone else's property without his consent. Further, conscription was slavery, and war was murder. Rothbard also opposed compulsory jury service and involuntary mental hospitalization.
It must be noted that there are other versions of anarcho-capitalism besides Rothard's version. For example
David D. Friedman's anarcho-capitalism advocates that law itself be bought and sold in the market, rather than just defense services. In Rothbardian anarcho-capitalism, there would first be the implementation of a mutually agreed-upon libertarian "legal code which would be generally accepted, and which the courts would pledge themselves to follow." This legal code would recognize
sovereignty of the individual and the
principle of non-aggression.
Tactics
Rothbard criticized the "frenzied nihilism" of left-wing libertarians but also criticized right-wing libertarians who were content to rely only on education to bring down the state; he believed that libertarians should adopt any non-immoral tactic available to them in order bring about liberty.
Rothbard's law
Rothbard's law is a self-attributed
adage. In essence, Rothbard suggested that an otherwise talented individual would specialize and focus in an area at which they were weaker — or simply flat out wrong. Or as he often put it: "everyone specializes in what he's worst at."
In one example, he discusses his time spent with Ludwig von Mises,
» In all the years I attended his seminar and was with him, he never talked about foreign policy. If he was an interventionist on foreign affairs, I never knew it. This is a violation of Rothbard's law, which is that people tend to specialize in what they're worst at. Henry George, for example, is great on everything but land, so therefore he writes about land 90% of the time. Friedman is great except on money, so he concentrates on money. Mises, however, and Kirzner too, always did what they were best at.
Continuing on this point,
» There was another group coming up in the sixties, students of Robert LeFevre's Freedom School and later Rampart College. At one meeting, Friedman and Tullock were brought in for a week, I'd planned to have them lecture on occupational licensing and on ocean privatization, respectively. Unfortunately, they spoke on these subjects for 30 minutes and then rode their hobby horses, monetary theory and public choice, the rest of the time. I immediately clashed with Friedman. He had read my America's Great Depression and was furious that he was suddenly meeting all these Rothbardians. He didn't know such things existed.
Criticism of Keynes and Bentham
Rothbard was an ardent critic of the influential economist
John Maynard Keynes and
Keynesian economic thought. His essay
Keynes, the Man, is a scathing attack upon Keynes' economic ideas and personage.
Rothbard was also severely critical of, among others,
utilitarian philosopher Jeremy Bentham in his essay, "Jeremy Bentham: The Utilitarian as Big Brother" published in his work,
Classical Economics.
Economists and the free market
Murray Rothbard devotes a chapter of
Power and Market to the traditional role of the economist in public life. Rothbard notes that the functions of the economist on the free market differ strongly from those of the economist on the hampered market. "What can the economist do on the purely free market?" Rothbard asks. "He can explain the workings of the market economy (a vital task, especially since the untutored person tends to regard the market economy as sheer chaos), but he can do little else."
Books
Man, Economy, and State (Full Text
; ISBN 0-945466-30-7) (1962)
The Panic of 1819. 1962, 2006 edition: ISBN 1-933550-08-2.
America's Great Depression. ISBN 0-945466-05-6. (1963, 1972, 1975, 1983, 2000)
What Has Government Done to Our Money? (Full Text / Audio Book) ISBN 0-945466-44-7. (1963)
Economic Depressions: Causes and Cures (1969)
Power and Market. ISBN 1-933550-05-8. (1970) (restored to Man, Economy, and State ISBN 0-945466-30-7, 2004)
Education: Free and Compulsory. ISBN 0-945466-22-6. (1972)
Left and Right, Selected Essays 1954-65 (1972)
(Full text / Audio book) ISBN 0-945466-47-1. (1973, 1978)
The Essential von Mises (1973)
The Case for the 100 Percent Gold Dollar. ISBN 0-945466-34-X. (Full Text / Audio Book) (1974)
Egalitarianism as a Revolt Against Nature and Other Essays ISBN 0-945466-23-4. (1974)
Conceived in Liberty (4 vol.) ISBN 0-945466-26-9. (1975-79)
Individualism and the Philosophy of the Social Sciences. ISBN 0-932790-03-8. (1979)
The Ethics of Liberty (Full Text / Audio Book) ISBN 0-8147-7559-4. (1982)
The Mystery of Banking. ISBN 0-943940-04-4. (1983)
Ludwig von Mises: Scholar, Creator, Hero. . (1988)
Freedom, Inequality, Primitivism, and the Division of Labor. Full text (included as Chapter 16 in Egalitarianism above) (1991)
The Case Against the Fed. ISBN 0-945466-17-X. (1994)
An Austrian Perspective on the History of Economic Thought (2 vol.) ISBN 0-945466-48-X. (1995)
Wall Street, Banks, and American Foreign Policy. (Full Text) with an introduction by Justin Raimondo. (1995)
Making Economic Sense. ISBN 0-945466-18-8. (1995, 2006)
Logic of Action (2 vol.) ISBN 1-85898-015-1 and ISBN 1-85898-570-6. (1997)
The Austrian Theory of the Trade Cycle and Other Essays. ISBN 0-945466-21-8. (also by Mises, Hayek, & Haberler)
Irrepressible Rothbard: The Rothbard-Rockwell Report Essays of Murray N. Rothbard. (Full Text.) ISBN 1-883959-02-0. (2000)
History of Money and Banking in the United States. ISBN 0-945466-33-1. (2005)
The Complete Libertarian Forum (2 vol.) (Full Text) ISBN 1-933550-02-3. (2006)
Economic Controversies (to be published 2007)
The Betrayal of the American Right ISBN 978-1-933550-13-8 (2007)
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