In the late 1960s, my interests were far removed from Austrian economics—and from any other brand of economics, for that matter. I hadn’t yet heard of Murray Rothbard and thus couldn’t even have imagined that I would be catapulted by him into the midst of what would later be termed the “Austrian Revival.” My degree was in electrical engineering, but the hoped-for career was stillborn because of Southeast Asia and the military draft. My years in uniform taught me the importance of having a purpose by depriving me—temporarily—of the possibility of having one. I did have time to read in the military, and like many others in that period, I began reading Ayn Rand’s novels as well as her essays in moral philosophy.
Objectivism is strong medicine, especially for those like myself who had spent their college years avoiding courses in the social sciences because of their apparent lack of structure and reason. Rand’s Capitalism: the Unknown Ideal was full of structure and reason and provided a moral foundation for a free society. The Austrian economists, featured in this book’s recommended readings, would show just what is—or ought to be—sitting on Rand’s foundation. Austrian economics is appealing to an engineering mind: basic principles, law-like propositions, unequivocal conclusions—all grounded in logic and applicable to the world as we know it. Authors that Rand believed to be worthy of attention are listed in alphabetical order. I look back now at my yellowed paperback purchased more than a quarter-century ago and note the neatly drawn check marks that track the progress of my reading: books by Benjamin Anderson, Lawrence Fertig, Henry Hazlitt, and Ludwig von Mises. Although my imperfect memory tells me that Murray Rothbard’s books were included in this list, I see now that they are not. But Rothbard had been publishing for several years and was for a time a member of Rand’s inner circle. Any enthusiastic reader would soon find his books.
I obtained a copy of America’s Great Depression through an inter-library loan. I found Rothbard’s account of boom and bust absolutely compelling and especially significant in light of the stark contrast between the views of the Austrian economists and those of the “educated” citizenry. With a monopoly on money creation, the government could artificially cheapen credit and orchestrate a business expansion, which eventually and inevitably would collapse. Policies commonly defended in the name of stability and growth led instead to instability and decay. In later years, I would attach even more significance to this early book of Rothbard’s as I discovered how badly other schools of economic thought had botched their accounts of business cycles.
With the engineering market glutted in the early 1970s when I and many of my peers were set free by the military, a popular option was to work on an MBA degree. I chose to pursue a masters in economics instead, thinking (erroneously) that the MA would be as marketable and the coursework more interesting. I entered the masters program at the University of Missouri at Kansas City. The courses on macroeconomics offered a steady diet of Keynesian analysis in the conventional form of interlocking diagrams that jointly determine the equilibrium values for the economy’s income and its interest rate. The substantial investment involved in mastering the diagrammatical technique seemed to give professors and students alike a special interest in defending Keynesian views.
In late 1972 I began to devise an Austrian counterpart to the Keynesian diagrams. Rothbard’s Man, Economy, and State provided the primary source material. In the end, I was able to draw together individual diagrams taken from or inspired by Rothbard, Mises, Hayek, Böhm-Bawerk and Wicksell and show that they all fit together into a coherent story about boom and bust. Titled “Austrian Macroeconomics: A Diagrammatical Exposition,” the paper was submitted as partial fulfillment of the course requirements in macroeconomics. The professor, whose preferred brand of economics was institutionalism as exposited by Thorstein Veblen and Clarence Ayers, gave me a high mark on the paper but confessed that he hadn’t actually worked through the graphical analysis and wasn’t familiar with Austrian economics. To my surprise, though, he offered to arrange for me to present the paper at the Midwest Economic Association meetings to be held in Chicago in April 1973.
With some urging from this professor, I agreed to go to Chicago. I soon realized, however, that neither he nor anyone else had provided me with any critical feedback. No one, in fact, had actually read the paper. And I was to present it to a professional audience in April! The one action item that occurred to me was to mail a copy of the paper to Murray Rothbard. Maybe he would respond in time to give me some confidence about Chicago—or to allow me to renege on my agreement to go.
About a week after mailing the paper, I got a phone call—from Joey Rothbard. She introduced herself with a very pleasant voice and said that her husband would like to speak with me. I then listened for the voice of a learned professor but heard instead an exceedingly jolly voice, interspersed with an infectious cackling and irreverent asides about modern-day graduate programs. Rothbard was clearly enthused about the diagrammatical exposition; he saw it as beating the Keynesians at their own game. “Would you be coming to New York anytime soon?” he asked. Although I had no plans whatever to go to New York, I managed to announce: “I’ll be there during spring break,” at which point he invited me for dinner and further discussion of the diagrams.
Dinner guests at the Rothbards’ are made to feel like special people. I was treated to a memorable dinner with the warmest hospitality amid the book-lined walls of the Rothbards’ upper-westside apartment. After dinner more guests arrived: Walter Block, Walter Grinder, and William Stewart, all of whom had carefully read my paper. The discussion was lively, mostly positive, and full of good suggestions for revision and further development. I took notes in the margins of my own copy. The evening passed quickly, and I began to worry about overstaying my welcome. But no one else seemed to be aware of the late hour. As midnight neared, I began packing my papers away and thanking the Rothbards for an unforgettable evening. The host and other guests seemed puzzled and almost insulted by my tenuous movement in the direction of the front door. I did not know that Murray was a complete and incurable night owl. For him the evening had just begun. We had lots of discussion ahead of us including some history and some methodology and quite a little bit of slightly gossipy banter about people in the Libertarian/Austrian movement. As best I can remember, I was allowed to leave around 4:00 a.m., after an invitation was extended (and accepted) to attend a class later in the day at Brooklyn Polytechnic Institute, where Murray taught economics to engineering students—and to stop by Laissez-Faire Books, where he would be autographing copies of his just-released For a New Liberty (See photo). The evening had crystallized into a major stepping stone in my own professional development. But there was something else that had happened which now has a special meaning for me. In the course of a single evening, Murray Rothbard, whose name continued to signify eminence in economics, history, and philosophy, had become for me just “Murray.”
The presentation in Chicago was a virtual non-event, which, as I learned later, is typical of sessions at professional meetings. But the disappointment was overshadowed by the fact that Murray had invited me to attend a week-long conference on twentieth-century American economic history sponsored by the Institute for Humane Studies to be held in the summer at Cornell University. He and Forrest McDonald were to lecture for a week to an audience consisting mainly of student historians. As it turned out, I was one of only a few economics students to attend. Near the end of the week, Murray asked me to present my diagrammatics in an informal afternoon session. I foolishly agreed. Since the audience of historians was largely unschooled in macroeconomics, I felt I had to present first the mainstream Keynesian diagrammatics (which typically takes a semester in undergraduate economics programs) and then counter it with my own Austrian diagrammatics. Needless to say, the session was a disaster. The audience, largely baffled, did include one economist, who criticized me roundly at every turn. But I forgave Murray for asking me to do the presentation and soon enough came to appreciate the criticisms offered by the lone economist. She is to be thanked rather than forgiven.
Although the week at Cornell was rewarding in its own right, it benefited me mainly by putting me on the invitation list for upcoming conferences in Austrian economics. The following year (1974) was the South Royalton conference, a conference that came to be widely recognized as the take-off point of the Austrian Revival. There, Murray, teamed up this time with Israel Kirzner and Ludwig Lachmann, gave stimulating lectures dealing with method, theory, and policy, all published later on as The Foundations of Modern Austrian Economics, edited by Ed Dolan. Henry Hazlitt and Bill Hutt added much insight and perspective to the discussions. Milton Friedman was there for the opening banquet. His now-famous remark that “there is no Austrian economics—only good economics and bad economics” had a certain—but unintended—galvanizing effect on conference. The list of listeners, most meeting one another for the first time, now reads like a Who’s Who in Austrian economics: Armentano, Block, Ebeling, High, Lavoie, Moss, O’Driscoll, Rizzo, Salerno, Shenoy, Vaughn. One purpose of the conference was to persuade Lachmann that there was sufficient interest in Austrian economics to justify his coming out of semi-retirement and teaching at New York University. By week’s end, the interest was not in doubt, and Lachmann soon began teaching at NYU.
For the two follow-on conferences held in successive years, F. A. Hayek joined the original South Royalton faculty. In 1975 the Austrians met at the University of Hartford in Connecticut; in 1976 they met in England in Windsor Castle. At both conferences, papers by South Royalton participants were presented and discussed. The Windsor Castle papers, among which was my newly revised “Diagrammitical Expostition,” were eventually published as New Directions in Austrian Economics, edited by Lou Spadaro. This unique three-year sequence of conferences on Austrian economics, engineered largely by Murray, nicely overlapped my years in the graduate program at the University of Virginia, a school I had chosen on Murray’s recommendation.
I can easily say that Murray’s influence on my career has been so significant that I simply do not know where I would be today or what I would be doing had it not been for his guidance. I knew Murray for the last twenty-two years of his life. I look back now and realize that he was not as old when I first dined with him and Joey as I am now. In stature, though, he seemed to me then like the Old Master—having more to show for his early years than most of us will have in the longest lifetime. Since then, of course, his influence, both personal and through his writing, has grown enormously. We owe much to Murray for the fact that the years since South Royalton have seen a steady growth of Austrian economics in universities both in the U.S. and abroad. Beginning in 1976 there have been teaching conferences almost every year—at Newark, DE, Oakland, CA, Boulder, CO, Milwaukee, WI, Auburn, AL, Palo Alto, CA, Claremont, CA—sponsored first by the Institute for Humane Studies and then by the Ludwig von Mises Institute. This year, the conference, billed as the Mises University, will be held in Auburn and promises to be a most significant event. Dedicated to the memory of Murray Rothbard, it will feature more than two dozen faculty members lecturing on a wide range of topics in economics, history, and philosophy.
Can Austrian economics survive without Murray? Yes, it can and will survive and grow. Although his passing leaves us all with an enduring sense of loss, we can see his life as the virtual personification of dedication and purpose. His legacy will provide us with the wisdom and the spirit to press on.