Coordination Problem

Podcast on Capitalism and the Family

In the comments on the prior entry, Brian Pitt asked if I was going to talk about my family book project at the Austrian seminar at FEE next week.  I will be but if you aren't going to be there and want a sense of things, FEE now has posted a podcast of the talk I gave at the "Applying Liberty" seminar earlier this month.  You can find it here (large mp3 file).  A whole list of FEE podcasts is here. 

That talk is an overview of the historical chapters of the book, arguing that capitalism created the modern family as well as driving the changes in the family we've seen in the last 40 years.  At FEE next week, I'll focus more on the Hayekian and Austrian themes in the theoretical material.

But if you have an hour to kill...

IHS --- Now We Are Talking

Peter Lipsey returned from the IHS conference in Chicago and presented me with this post-card image of the IHS version of Mount Rushmore.

It has been awhile since I would have associated IHS with such a clear cut endorsement of these thinkers and I am thrilled to see it. Throw Mises in there for Isabel Paterson and we can get really serious.

Seriously, I guess if I had my Mount Rushmore I would put Mises, Hayek, Nozick, and Friedman. Who would be on your Mount Rushmore?

BTW, have you seen the various discussions of the silly behavior by U of Chicago faculty members who are "concerned" about the establishment of the Milton Friedman Institute? If Milton Friedman can cause intellectual angina among "faculty" smart enough to warrant an appointment at U of Chicago, then everyone should realize the intellectual state of affairs we are in. Almost as dire as the economy itself! If that is an accurate depiction of the world of ideas in US universities, then organizations like FEE, IHS and Liberty Fund have a huge role to play in creating space for classical liberal and libertarian scholarship --- but they will be successful only if they do not water-down the message either by cheap commitments to non-thinking sloganeering or stealthy and non-commitment to libertarian scholarship. As I have said before, we neither want ignorant dogmatism nor milly-mouthed pseudo-sophistication. Time, instead, to uphold as ideal intellectual role models: Mises, Hayek, Rothbard, Rand, Nozick and Friedman (among our honored deceased from the 20th century) and Buchanan and Epstein (among the still living great classical liberals).

Upcoming FEE conference on Austrian Economics

From August 3-9 The Foundation for Economic Education will host the annual Austrian Economics Seminar.  This seminar was initiated by Israel Kirzner over 30 years ago and is intended to provide an educational opportunity to advanced students who otherwise would not get the opportunity during their regular studies to study Austrian economics in depth.  Over the years the seminar has been sponsored by IHS and FEE, operated for a period independently at NYU, and then moved back to FEE.  FEE in my opinion is an ideal setting for the seminar, and I get a great thrill returning to the FEE campus every year for this seminar.

FEE has also officially announced that Lawrence Reed will take over as President on September 1, 2008. Congratulations to Larry and also to the FEE Board of Trustees on this selection.  Larry built the Mackinac Center in Michigan after stepping down as Professor and Chair of the Department of Economics at the Northwood University.  Larry was able to build the Mackinac Center into the ideal model for state-based think tanks for market oriented policy.  Larry is a tireless champion of classical liberalism, his early scholarship was in the field of economic and monetary history, his early activism was in fighting communism as an underground educator behind the Iron Curtain and fighting the public education establishment and the teacher's union in what is perhaps the most unionized state (Michigan), his commentaries and op-eds are penetrating and insightful, and his teaching style in the classroom and in public lectures is clear and convincing.   A great choice to lead this grand old institution of economic education. 

Good luck Larry!!!

June 2008 Freeman Now Available

The June 2008 issue of The Freeman is now available at FEE's website.  This issue is headlined by a very timely piece by Bob Murphy on whether the Federal government can save the housing market.  It also includes another contribution by Yours Truly:  "Economists and Scarcity."  I channel Julian Simon in discussing the incorrect perceptions the environmentalist left often seems to have about economists and how we talk about "resources" and "scarcity."

My Time at the LSE

This summer, I had the honor of visiting the LSE/STICERD as the 2008 F.A. Hayek Fellow.  As part of the fellowship, I was provided with office space at the LSE and the opportunity to meet with faculty and students (the picture is of me with the Lionel Robbins bust located in the Lionel Robbins Building where STICERD is housed).  It was a pleasure to meet Tim Besley who was a gracious host.

In addition to meeting the faculty and students at STICERD, other highlights of my trip included:

1. Meeting Chandran Kukathas and participating in a seminar on his excellent book, The Liberal Archipelago.  Chandran is the leading proponent of cosmopolitan liberalism and I highly recommend his book.
2. Participating in the Austrian reading group organized by Paul Lewis, John Meadowcroft and Anthony Evans.
3. Speaking at the Institute for Economic Affairs where John and Christine Blundell were kind enough to host me for an evening lecture (my talk was on "Institutions, Entrepreneurship and Development").  John also gave me an excellent tour of the Westminster area where, among other things, I learned about the history of the private provision of fire services in London.
4. Speaking at the European School of Management where Anthony Evans organized a talk on After War.  It was good to catch up with Anthony and see first-hand the excellent program he is helping to build.
5. Meeting Dominique Lazanski, the former president of the Hayek Society.  I was disappointed to learn that the Hayek Society had lost momentum since Dominique graduated from the LSE.  However, Dominique connected me with all the right people and was a great help throughout my visit.  Further, as an avid reader of all things Austrian economics and classical liberalism, Dominique is fun to talk to.
6. Touring London and Scotland (Glasgow was nice, but Edinburgh was by far my favorite).

In addition to my meetings and talks, I was able to get a good deal of research done.  I will be posting more on this in the future.

I want to thank Tim Besley of STICERD and Toby Baxendale for providing me with the opportunity to spend time at the LSE.  Also, Sue Coles, Jane Dickson and Angela Swain were extremely helpful in enabling my visit to go as smoothly as it did.

The Mass Psychological Conversion Experience Theory of Falling Gas Prices

I returned home very late last night after several days visiting midwestern universities with my son.  On the way, I noticed that gas prices along my Syracuse-Watertown-Canton route had fallen since we left, in some cases by several cents.  Falling gas prices always lead me to wonder how those who think high gas prices are the product of "greedy oil companies and gas stations" explain falling gas prices.

If one really believes rising prices are the product of greed, then it seems to me that one must also therefore believe that falling prices are the product of altruism.  Thus, the explanation for the turnaround in gas prices in the last week or so must be because oil companies and station operators have had a psychological conversion experience!  Suddenly, they have all become (at the same time no less!) much less greedy and much more willing to give consumers a break, right?

Of course this is nonsense, but it does pose a challenge for the Greed Theorists:  if they are not inclined to accept the Mass Psychological Conversion Experience theory of falling gas prices because they are totally convinced that oil companies and station owners are, in fact, Greedy Bastards, then it can't be the case that greedy behavior is uniquely problematic.  Sometimes it causes prices to rise, sometimes it causes them to fall.  If so, then it's not a very good way to explain what causes prices to move.  Maybe, just maybe, it's something else.... oh say like supply and demand even.  And maybe, just maybe, self-interest can sometimes, if not frequently, produce good results.

Nah, it can't be that, can it?

Horwitz on TV update

Had my interview with Stossel this morning.  It was a lot of fun.  It's a one-hour special on Katrina that will air sometime in October.  I'll post the exact date when I know it.  Based on the producer's reaction, I have every reason to believe that I will have a significant role in the final product.

Gas Prices Are Up, but We Don’t Have Price Controls

Don Boudreaux’s recent Letter to the Editor of the Atlanta Journal-Constitution (see below) reminds me of our good fortune. Gas prices are up but policymakers have not reacted with their old tools from the 1970s, namely price controls. Instead, market prices are free to reflect the scarcity of oil that currently exists worldwide. Moreover, Congress is trying to reduce some of the barriers that limit supply. Why such a change in 30 years?

Many Americans still have some recollection of the effects of price control and know that it was not a good solution. The public is also more aware today that gas prices are not determined in the US, but on world markets. What price controls would achieve is creating shortages in the US without having any impact on world prices. Americans by and large seem to believe (rightly so) that policies aimed at expanding supply (even just US supply) stand a better chance of reducing gas prices (for everyone, not only Americans) than policies that would control US domestic prices.

Have Americans become more acquainted with economics in the last 30 years? Probably not, however, there is nothing like living through changes in policy to learn something about economics. For instance, many of my fellow friends from New Zealand have become more conservative than they used to be as a result of the reforms in the 1980s and 1990s. In the 1970s, the Berlin Wall was still up and the West still entertained the idea that economic planning was good policy. True, there is still plenty of economic planning in policy today, but there is much less in rhetoric. People have come to realize the limits of price control. What the public saw as good policy in the 1970s is now deemed irrelevant. Really? Well, time will tell. If gas prices continue to climb up, it may come with a rising demand for price control.

Here is Don Boudreaux’s letter:

21 July 2008. Editor, Atlanta Journal-Constitution

Dear Editor:

I disagree with Cynthia Tucker's claim that "Carter deserves credit for his energy smarts" (July 20). The price controls enforced during Jimmy Carter's presidency - ones within his power to lift - were responsible for fuel shortages.

I well remember in July of 1979 my father driving to a gasoline station at midnight only to wait in line. He waited in that line until 6am, when I (having walked the mile and a half from our home) relieved him. The station finally opened at noon. It allowed each motorist in line to buy a maximum of five gallons of gasoline. I bought the five gallons and drove home - without, of course, turning on the air-conditioner, for to do so would have burned too much of the precious elixir. As we lived in New Orleans, these sorry recollections of the consequences of misguided government intervention are seared especially hot into my memory.

Sincerely,

Donald J. Boudreaux

Chairman, Department of Economics - George Mason University

Review of Austrian Economics - Automatic TOC Alerting

I would like to urge readers of the AE to register for automatic table of contents alerting for The Review of Austrian Economics.  Registration takes less than a minute and only requires that you enter and confirm your email address.  When you register, you will receive an automatic email which lists the TOC when a new issue of the RAE is published.  This is a low cost way of keeping up to date on the latest Austrian research.

Please take a moment to register for this service here.  The registration is about half way down the page on the right - "Table of Contents Alert for this Journal".  Enter your email, confirm your email, and select "Go".

Also, please keep in mind that you can find past issues of the RAE, free of charge, here.

If Pete Can Post about Basketball and Tennis...

I can point you to the Best.  Episode of The Colbert Report.  Ever.