Three Cheers for the Red, White, and Blue

The reference, of course, would be to the Coat of Arms of the family of Ludwig von Mises, awarded in 1881 by Emperor Franz Josef I of Austria. Particularly apt is the Staff of Mercury in the upper right quadrant of the shield, symbolising commerce and communication.

Mises left Europe for the US in 1940. The US, at that time, was regarded as the Land of the Free. It was the country that free-minded people admired and many hoped to move to. The Old World was sinking dramatically into fascism, socialism, and communism. The US, by contrast, shone like a bright new copper penny.

But the copper shine is long gone from the US penny. It is now only 2.5% copper, having been debased like the Roman Denarius before it.

In similar fashion, the concept of Freedom has been dramatically devalued in the new American system.

The Ludwig von Mises Institute is still domiciled in the US; however, the Austrian school of economics, which is centred on principles Mises taught, is viewed very differently today than it was when he was welcomed to become a Professor at the Graduate School of Business Administration at New York University (a position which he held for 24 years).

Today, Austrian economics is viewed with, not only scepticism, but derision, by many.

In 2012, US presidential candidate Ron Paul dared to promote Austrian economics in a presidential election campaign, even to the extent of popularising an "End the Fed" movement. Interestingly, Doctor Paul was vilified by both conservative Republicans and liberal Democrats to an even greater degree than they vilified each other. Clearly, Doctor Paul and his libertarian ideals were seen as a greater threat to the two conventional parties than they see each other to be.

Why should this be so?

Well, the two-party system allows any country to maintain the illusion that the electorate has a choice. It can vote for the more liberal or the more conservative party, suggesting that the problem in the county is the opposing party. However, in most every country where the two-party system exists, one significant fact remains the same: Both parties espouse greater control by the central government. The real goal of politicians is not greater liberalism or greater conservatism, but the growing of an ever-larger, more powerful central government.

Just as libertarians like Doctor Paul are a threat to the central goal of governments, Austrian economics represents a threat to the concept that a government should be the unquestioned controller of all things economic.

Ludwig von Mises was both a highly-educated economist and a political visionary. He departed Austria in 1934 for Switzerland as he saw the coming of totalitarian control by the Nazis. Although Austria was still safe at that time, Mises understood that the day would come when Austria would become a veritable prison for free thinkers like himself.

By 1940, Germany had already conquered much of Europe, and the Swiss were concerned that Mises' residence there might antagonise the National Socialists. Under pressure to leave, he headed across the pond to the US.

In each case, Mises made his moves well in advance of the coming domination stage of events. Although, in the end, Germany did not attack Switzerland, the lesson to be learned is that, once a government begins its clamp-down on basic freedoms and once it has begun to create a police state to enforce its edicts, the writing is on the wall.

Time to Move

At such a point, it would be unwise to "wait and see" whether the next stage—the stage of domination—is implemented. History demonstrates that, once the warning signs become evident that a government is moving in a totalitarian direction, the wise move is to place some distance between yourself and the offending government.

It should be noted that, historically, no nation of people has ever created a groundswell that successfully reversed the progress of a totalitarian government, once it was well underway. Generally, the course of events is that the penultimate stage is characterised by increasing domination and warfare. The final stage is one of social, political, and economic collapse.

It is difficult to picture, today, the perspective of Europeans in the late 1930s. All around them, they could see an economic and political decline, yet the vast majority of people stayed right where they were, like horses that fear to leave a burning barn. They had become accustomed to the fact that Europe was the commercial and cultural centre of the world. It was "the best place to be" in most every way.

So, when the decline transpired, it was difficult to imagine an escape, as that escape would mean a move to the new world to the west. Surely, such a move was for the very poor, the refugees. Those who were educated—those who were successful—considered emigrating to a "less evolved" country to be a regressive step.

And so, they stayed.

In hindsight, of course, it is easy to see that those like Mises, who had their eye on the horizon, stayed a few steps ahead of events and exited prior to the point that domination was at hand. Had Mises not done so, he would simply have been one more casualty of the oppression that followed and would be forgotten today.

Instead, he gained the opportunity, in a freer country, to see his message blossom.

Each country has its day in the sun. Each country then experiences its decline. Those who choose the comfort of remaining rooted to a country that has once been great, may well find that, when the decline reaches its final stages, they may be swallowed up. Those who have the vision and the courage to regard liberty as being more important than comfort, will take up a new, more fruitful life elsewhere.

The timing of that decision, as it was for Mises, is likely to be critical.

Tags: economic collapse, austrian economics,