VAN MISES INSTITUTE SCHOOL OF AUSTRIA ECONOMICS STILL DOESN’T GET IT, BUT THEY’RE FINALLY GETTING CLOSE…

 “The simple truth is that economics does not determine our form of government, but it is our form of government that determines our economics.” WWFawell

Here is a recent blog from the Mises Institute out of of Auburn http://bastiat.mises.org/2014/01/hitlers-economics-why-you-should-know-a-thing-or-two-about-them/ , that comes as close to the realization by any economists that politics, and more especially political structure, determines a nations economics, and that economics is secondary and wholly dependent upon political structure.

   It’s something that no economist can either fathom or stomach, because it means that their particular discipline is secondary to a nations political structure, and wholly dependent upon that structure.

  It means that the viability, importance, and esteem the world holds for the entire field of economics and the economist is a myth and a lie, and that economics is simply the natural consequence of the academic discipline of political science.  It also means that most economists are not only over paid, but that they should be out of a job.

  Written by Chris Rossini for the Economic Policy Journal (a wasted effort), Mr. Rossini almost hits at the very point upon which all economic questions revolve, and that is politics, the realm of the political scientist, a discipline that has been banished to the academic wood shed of higher education.

  Rossini’s blog is a brief study of the roll that Hjalmar Schacht played in building the economic model that would compliment Hitler’s Third Reich, falling into the time honored illusion that Schacht therefore made Hitler.  Rossini then stumbles on by picking up an article by economist Henry Hazlitt, in the Jan. 9, 1947 edition of News Week, that while Hitler had lost a war, the Allies of Western Europe had come to embrace “Schachtism”.  

  This is complete and utter nonsense.  Western Europe didn’t adopt Schachtism, they had simply been operating a more latent form of “fascism”, which once again, is a political model.  A political model that Hitler had Schacht working out the finer points of developing what Hitler was already executing.  

   The Rossini/Hazlitt Western European version of Schachtism is in reality, an altered version of Keynesianism, created by a hapless hired economist of the banking elite to validate the economic programs that they had engineered in full swing during the post WWI era between the World Wars, which was engineered on the face of it by Ben Strong, Monte Norman, and Mariner Eccles.

   To postulate that Schachtism took post war Europe by storm and was the driving force behind Hitler is absolutely absurd.  To be fair to Schacht, he was the driving force that kept Germany in the War, only falling out of favor in its aftermath.   But during the hyper-inflation of the Weimar Republic (1922,23,24), Schacht was brought back as the Reichsbank President in late 1923, and brought the hyper-inflation back under control on August 30th, 1924.   He then spent the next 4 years fighting with Ben Strong and 5 more fighting JP Morgan over a stable economic environment.  What he was trying to do was to avoid being dragged into the inevitability Crash of 1929 and its lack of stability.   Not surprisingly, he received both the Crash of 1929 and instability.

   By 1933, is it so shocking that both Schacht and Hitler came to the conclusion that the economic war being waged upon Germany was simply the continuation of WWI, and that they’re only option was to pick up WWI where they left off.  It all depends upon your perspective and whether you won the war or lost it.   In truth, Shachtism or Keynesianism are both ecomomic sycophants of two different levels of fascism.   Hitler might have been a pure fascist, but America today is a technocratic monarchy disguised as a democracy, which is just a different form of fascism and still a tyrannical state.

   What fascism really is, is a tyrannical state, the same as communism, socialism, libertarianism, or a monarchy, oligarchy, democracy, all of which can be suffixed by a “techno”.   But they all remain representative of the tyrannical state.   And if the Austrian School finds that Schachtism has taken hold over the governments of Europe that won the war, what’s the point?   It’s a rhetorical question, because the answer is the same daily operating model for all.

   What would  be more accurate for the Austrian School to become cognizant of, is that it is not the economic policy that makes the economy what it is; but it is the government which determines the economic policy that makes the economy what it is going to be.

Rossini’s Conclusions: Liberty vs. Fascism

Here is where Rossini almost makes the true connection of the superior importance of the political state; being the cause of economic theory and its clear superiority, over and the pointlessness, of the economist, but he just can’t make that final jump because he’s been blinded by his academic roots.

   In wrapping up his final point, Rossini clearly states the what America (World) faces, is a battle pitting Liberty vs. Fascism, and in support of that, he provides the definition of Fascism by none other than Lew Rockwell, to wit:

“Fascism is the system of government that cartelizes the private sector, centrally plans the economy to subsidize producers, exalts the police state as the source of order, denies fundamental rights and liberties to individuals, and makes the executive state the unlimited master of society.”

   What Rossini fails to do now is to provide the definition of what he portends to fight Fascism with, Liberty.  He never touches the subject, as if everyone is suppose to know what that means; that or he suggests that no one really knows what Liberty means.  To tell the truth, Rossini only has a vague idea of the economic theory behind his undefined definition of Liberty in the promise of a gold standard and sound money.   But that is never going to happen until the daily operating model of government has changed first.   Rossini hasn’t thought his thoughts through to the end.

  And here is where we find the unspoken truth that Rossini and every other economist can never see.   Liberty has a definition, and the fight isn’t against fascism, it is against tyranny in all of its forms by replacing it with the daily political operating model of Liberty, defined as a government that is Ruled by the People.   A nation changes its daily operating model of political government and you will automatically get a more sophisticated version of the Austrian School of Economics.

  Liberty has its own unique operating structure, just like every form of tyranny shares a common operating structure that is in diametric opposition to that model of Liberty.  Determine what that government structure and its operating model for the creation of laws and policy and you will have set the policy for money, trade, war, budget, peace, regulation, taxation, markets, and the nations standard of living, and not the other way around. This is a lesson that economist the world over never learn because they are so caught up in the importance of one segment of an endless equation, that they fail to see the whole; It never them that they are pontificating upon myths and illusions, because if they did, they would be out of a job.

  The emperor has no clothes.

  But Rossini and every economist at the Mises Institute in either Auburn or Montreal have only the very most obscure idea of what Liberty is, how it works, what it means, and why it is the determining factor of what any economic model is going to look or perform like in the real world.  They have absolutely no idea.

  If they did, they would have to tear down the myth of economics and bury its illusion that has granted it a functional power over our lives.  It would also put themselves and every other economist out of a job, and the world would be a better place.

  Do not misunderstand me, I admire the Austrian School of Economics and Ludwig van Mises, and it is what van Mises stands for that is the inevitable result, and not the cause, of a government that is Ruled by the People of a State in Liberty.

  If I can share nothing else with the reader, I would say the simple truth is that economics does not determine our form of government, but it is our form of government that determines our economics.

SERFS UP AMERICA!

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