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Interventionism: An Economic Analysis
Shortly after arriving in the United States, having fled a war-torn Europe, Ludwig von Mises sat down to complete his trilogy on economic systems. The result was this remarkably concise treatise, which tragically was not published until 1998. What Mises had foreseen was a world trapped between fully planned economies, which were clearly failing, and fully free markets, which were a casualty of depression and war. He warned that mixed systems give rise of political instability and economic stagnation, and proved that this was the case through a general model of interventionism and a specific analysis of price control, credit expansion, subsidies, welfare, corporatism, and the war economy. Particularly interesting is his discussion of the draft, which he sees as a species of socialism itself. A crucial book to understand in the post-socialist age. This book is not to be confused with his earlier book on price control entitled A Critique of Interventionism.
The contents of this volume
Introduction 1. The Problem 2. Capitalism or Market Economy 3. The Socialist Economy 4. The Capitalist State and the Socialist State 5. the Interventionist State 6. The Plea for Moral Reform I. Interference by Restriction 1. The Nature of Restrictive Measures 2. Costs and Benefits of Restrictive Measures 3. The Restrictive Measure as a Privilege 4. Restrictive Measures as Expenditures II. Interference by Price Control 1. The Statutory Law Versus Economic Law 2. The Reaction of the Market 3. Minimum Wages and Unemployment 4. The Political Consequences of Unemployment III. Inflation and Credit Expansion 1. Inflation 2. Credit Expansion 3. Foreign Exchange Control 4. The Flight of Capital and the Problem of "Hot Money" ISBN 1572460717
93 pp. (pb)
The contents of this volume
Introduction 1. The Problem 2. Capitalism or Market Economy 3. The Socialist Economy 4. The Capitalist State and the Socialist State 5. the Interventionist State 6. The Plea for Moral Reform I. Interference by Restriction 1. The Nature of Restrictive Measures 2. Costs and Benefits of Restrictive Measures 3. The Restrictive Measure as a Privilege 4. Restrictive Measures as Expenditures II. Interference by Price Control 1. The Statutory Law Versus Economic Law 2. The Reaction of the Market 3. Minimum Wages and Unemployment 4. The Political Consequences of Unemployment III. Inflation and Credit Expansion 1. Inflation 2. Credit Expansion 3. Foreign Exchange Control 4. The Flight of Capital and the Problem of "Hot Money" ISBN 1572460717
93 pp. (pb)
98 pages, Paperback
First published November 1, 1941
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437 people want to read
About the author
Ludwig von Mises
271 books1,244 followersLudwig Heinrich Edler von Mises (German pronunciation: [ˈluːtvɪç fɔn ˈmiːzəs]; September 29, 1881 – October 10, 1973) was an Austrian economist, historian, philosopher, author, and classical liberal who had a significant influence on the Austrian government's economic policies in the first third of the 20th century, the Austrian School of Economics, and the modern free-market libertarian movement.
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Displaying 1 - 8 of 8 reviews
November 6, 2022
Sept. 2016 (updated in fairly minor ways - 23 June 2020 and 2022-11-06)
Wonderful little book, only 95 pages, not including the recommended two page “Reading References” and excellent Index. This is part of Liberty Fund’s fantastic set of virtually all of the writings of Mises and this one is a perfect short primer. Everything about this book and the whole set is high class, except the price. I recommend any and all very highly.
Takeaways that rewarded me for reading this short book:
1. How government intervention always makes society poorer – believe it or not.
2. How government intervention is a short-term and not a stable system.
3. How government intervention can create a few winners, but overall makes most people worse off. Can you see how this is exactly what our “crony capitalist” system is doing today?
4. How government intervention helps create the conditions, animosities, and triggers leading to war – and I leave it to the reader to connect the dots on how relevant this is, considering the platforms and constant campaign calls by Trump/GOP as well as Clinton/Dems for protective tariffs (massive interventions) on two of our most important trading partners China and Mexico, as well as immigration barriers (more interventions) on many others.
5. How government interventionism actually fails to achieve the stated goals of its proponents (Whether the proponents really believe in or are motivated by those stated goals is another discussion). Great examples of Min. Wage, Rent Control, etc. are classic. But the basic idea could easily be applied to such massive interventions as Obamacare, Dodd-Frank, etc. etc.
6. How government interventions lead to more government interventions and then yet more interventions and that progression eventually and logically leads to socialism.
7. How the only logical, productive, just and peaceful alternative policy is laissez faire – free markets.
The book was written in 1940, AFTER WWII began in EU, but BEFORE the US had entered the war. You may be amazed at how revealing Mises’ comments on and some quotes from the major figures such as Hitler, Stalin, Mussolini, Franco, Chamberlin, FDR and several French leaders of that era are. Some figures or contexts may be a stretch for many readers, but the brief editor’s notes are perfectly enlightening and a real joy.
I’ll end with a quotation from the book on another historical figure, one who is not often quoted in economic contexts. The prescience of this statement is simply remarkable, especially considering when he made it, at almost the zenith of the Nazi war machine’s maximum power and what happened just six long and terrible, but by no means foreordained, years later: “Herr Goering was more honest in this respect. He told his people “guns OR butter,” but not “guns AND (therefore) still more butter.” This honesty is the only thing Herr Goering will be able to claim to his credit before the tribunal of history.”
Readers who may not appreciate the reference fully, will be totally enlightened by the brief five line Editor’s note in the book. I thought I knew why the quote was prescient immediately, but by reading the note learned extra context from it that made the quote even more amazing to me.
This book was an update, synthesis and restatement of a longer compilation of essays from the 1920s, collected and published as an anthology in 1929 by Mises' main publisher then, Gustav Fischer Verlag, called "Critique of Interventionism," newly translated into English by Hans Sennholz and published in 1977 by Arlington House. I just (Oct 2017) listened to that "Critique of Interventionism" book again (after a 40 year period) on audio file and much prefer the later 1940 manuscript book which is shorter, more updated and not as focused on German writers. That does not mean the older book does not have good value. But that value is more for the person with a German centric &/or more historical focus.
Wonderful little book, only 95 pages, not including the recommended two page “Reading References” and excellent Index. This is part of Liberty Fund’s fantastic set of virtually all of the writings of Mises and this one is a perfect short primer. Everything about this book and the whole set is high class, except the price. I recommend any and all very highly.
Takeaways that rewarded me for reading this short book:
1. How government intervention always makes society poorer – believe it or not.
2. How government intervention is a short-term and not a stable system.
3. How government intervention can create a few winners, but overall makes most people worse off. Can you see how this is exactly what our “crony capitalist” system is doing today?
4. How government intervention helps create the conditions, animosities, and triggers leading to war – and I leave it to the reader to connect the dots on how relevant this is, considering the platforms and constant campaign calls by Trump/GOP as well as Clinton/Dems for protective tariffs (massive interventions) on two of our most important trading partners China and Mexico, as well as immigration barriers (more interventions) on many others.
5. How government interventionism actually fails to achieve the stated goals of its proponents (Whether the proponents really believe in or are motivated by those stated goals is another discussion). Great examples of Min. Wage, Rent Control, etc. are classic. But the basic idea could easily be applied to such massive interventions as Obamacare, Dodd-Frank, etc. etc.
6. How government interventions lead to more government interventions and then yet more interventions and that progression eventually and logically leads to socialism.
7. How the only logical, productive, just and peaceful alternative policy is laissez faire – free markets.
The book was written in 1940, AFTER WWII began in EU, but BEFORE the US had entered the war. You may be amazed at how revealing Mises’ comments on and some quotes from the major figures such as Hitler, Stalin, Mussolini, Franco, Chamberlin, FDR and several French leaders of that era are. Some figures or contexts may be a stretch for many readers, but the brief editor’s notes are perfectly enlightening and a real joy.
I’ll end with a quotation from the book on another historical figure, one who is not often quoted in economic contexts. The prescience of this statement is simply remarkable, especially considering when he made it, at almost the zenith of the Nazi war machine’s maximum power and what happened just six long and terrible, but by no means foreordained, years later: “Herr Goering was more honest in this respect. He told his people “guns OR butter,” but not “guns AND (therefore) still more butter.” This honesty is the only thing Herr Goering will be able to claim to his credit before the tribunal of history.”
Readers who may not appreciate the reference fully, will be totally enlightened by the brief five line Editor’s note in the book. I thought I knew why the quote was prescient immediately, but by reading the note learned extra context from it that made the quote even more amazing to me.
This book was an update, synthesis and restatement of a longer compilation of essays from the 1920s, collected and published as an anthology in 1929 by Mises' main publisher then, Gustav Fischer Verlag, called "Critique of Interventionism," newly translated into English by Hans Sennholz and published in 1977 by Arlington House. I just (Oct 2017) listened to that "Critique of Interventionism" book again (after a 40 year period) on audio file and much prefer the later 1940 manuscript book which is shorter, more updated and not as focused on German writers. That does not mean the older book does not have good value. But that value is more for the person with a German centric &/or more historical focus.
June 22, 2020
The fable of the bees.
Does government intervention serve or frustrate the intention of those who want to put it into operation?
Ludwig von Mises' thesis:
Government intervention merely disrupts the market economy in the short run and destroys it completely in the long run. Governements should not concern themselves with matters outranging regal powers & the protection of life and property against violence and fraud.
LvM posits that the unhampered market economy is better suited to satisfy human needs, more beneficial to the individual & general welfare.
In the words of the editor:
'In this book, Mises shows how government intervention results in consequences its proponents did not intend. It hampers production, causing artificial scarcities. It creates special interest groups. It leads to inflation, domestic economic conflict, a militant nationalism, international conflict, and even war.'
In the words of LvM's himself:
'Despite all attempts to invalidate this argument, the fact remains indisputable. In the unhampered market, forces are at work which tend to put every means of production to the use in which it is most beneficial for the satisfaction of human wants. When the authority interferes with this process in order to bring about a different use of the productive factors it can only impair the supply, it cannot improve it.'
'The unhampered market economy is not a system which would seem commendable from the standpoint of the selfish group interests of the entrepreneurs and capitalists. It is not the particular interests of a group or of individual persons that require the market economy, but regard for the common welfare. It is not true that the advocates of the free-market economy are defenders of the selfish interests of the rich. The particular interests of the entrepreneurs and capitalists also demand interventionism to protect them against the competition of more efficient and active men. The free development of the market economy is to be recommended, not in the interest of the rich, but in the interest of the masses of the people.'
-----
MY OPINION:
Actually, I am favourably impressed by the way the essay is actually written compared to what I was expecting from 'praxeology'. LvM does not rely on statistics or numerical data but uses an array of examples drawn from Ancien Régime economy, various European crises and the era when the book was written (1940), which informed quite a lot of his arguments against socialism.
The author uses historical examples as to the development of liberalism & conceptualization of the laws of the market, corporativism, syndicalism, inflation, unemployment. The key notions debated are carefully defined and each part of the book methodically, clearly organized.
Still, part of the book feel dated indeed and the outview lacks scope or better said, the proper tools to deal efficiently with the current state of affairs, be it only in the narrow field of economics. Also, even though they are always painstakingly defined, some terms are misused ('total war') or downright fallacious (see 'asian despotism').
Finally, parts of the book felt grounded on little more than LvM's personal opinions regarding a hypothetically pure socialism or capitalism.
In short, I appreciate LvM's essay much more for the questions it raised than for the answers it offered, neglecting some issues ingrained in the 'unhampered' market economy. More important, it clearly showed I have some research to do on a wealth of different matters.
-----------------------------------
SOME OF THE QUESTIONS RAISED :
1) What manner of taxes are to fund the State? Flat tax? Progressive tax? Why? When is it considered as interfering? And interfering with what exactly?
2) Can political power exist without/outside economical power?
3)
Posits again absolute severance of agency between entrepreneurs & customers consuming their goods/services + absolute personal responsibility for the choices made by each of them.
Is it a sheerly personal decision actually? Are these needs not pliable? Can't entrepreneurs manufacture the needs of their consumers-to-be?
See supplier-induced demand, modern marketing : advertisement, agressive pricing, temporary sale below cost, planned obsolescence, addiction & behavioral targeting, addiction by design & compulsion loops...
4)
See Piketty on the history of proprietarism, or how old feudal rights have been confirmed as modern property rights in France.
Isn't private property allowed to exist and prosper because of a series of factors not depending on the capitalist or the entrepreneur? If so, why should ownership, propriety be held as entirely due to the entrepreneur/capitalist and held as immutable, unalienable?
5) I have to do research about 'the constant recomposition of the entrepreneurial elite'.
6) Are the prices, wages, interest rates being the result of the workings of the market to be considered the sole common denominator and only reliable indicator of economic action?
7) Are all activities bound to be profit-oriented?
Or, in von Mises' words, are these branches more beneficial to the general welfare, when privatized? See Energy, power and water supply, post offices, hospitals, schools, communications...
See privatization of water supplies in South America.
8)
9)
Is politics without a form of party politics a workable system? Isn't it something akin to dictature/enlightened despotism more often than not?...
10)
[Richard wrote:] ...as opposed to the current system where the very wealthy are the only ones allowed to flout the law unpunished.
[P.E. wrote:] That must be the State has failed then. Unless the State is necessarily partial because it consists of entrepreneurs, too? Unless something replaced the State as the authority? (see below)
What about governments serving the interest of entrepreneurs, when not entrepreneurs themselves?
The conditions might have been different in 1940, still, you have to consider the amount of private & corporate tax-free donations funding political campaigns. You can't understate the importance of such subsides & publicity in democratical elections (e.g. in the USA & France) : you can't just infer democracy from people freely voting for their political representatives, you have to take the process as a whole.
That doesn't invalidate LvM' whole point but calls for nuance & dicussing the necessary conditions for a meaningful democracy to take place.
11) Concerning LvM's arguments against state regulations about product quality or protectionism, 2 instances of interventionism.
- Health measures (abestos in construction industry, lead in toys, railings..., radium, planned obsolescence). Is that to be left as the sole responsibility of the consumer, when pricing and elimitation of concurrence restricts his leeway? ...
- Is it to the interest of consumers that some branches of their national/local economy disappear? (small shops, bookstores, local agriculture...) What are the effects of it on a sheer economical point of view? On consumption? Since some consumers are no longer working in that branch.
Former customers/consumers no longer participating in the economy.
LvM's answer to that issue:
- Is it done in the interest of the consumers not to somewhat preserve national and local production sites & a home market, should supplies from foreign countries cease, for a given period of time? In case of production shortage overseas, let's say, of farming products, or of healthcare supplies (masks...) for instance?
- It is certainly beneficial to have several suppliers for a given product to satisfy demand, but still, by preserving key sectors, restrictive measures (protectionism, public aid) can ensure local and temporary improvement of the state of supplies especially in critical situations. Prove me wrong.
12) Research to do about allegedly successful measures of price control : Lang Law 1981, 'BQP' measures for French Overseas territories, 2012, HLM (social housing, allowed to exist by tax exemption, public credit...).
More research to do about affordable accommodation today (monstrous waiting files in Berlin for a flat on 28/11/2019...), SMIC (minimum wages), syndicalism & their effects, both positive and negative.
13) Is it to say whatever doesn't benefit the unbrindled market is cronyism, favouritism, expediency? Are there no other interests at play? Is politics even needed if all should go through the 'consumer's ballot'?
14) On LvM's conception of a just, helpful tax :
A flat tax, that is. I'm not that sure it supports the interest of low wage-earners in the short to middle-run at the bare minimum.
Also, in the long run, the success of such a measure still depends on capital owners willing to raise wages in the face of the need for international competitiveness.
15) If workers are oblivious of the real state of affairs or don't know the whether the business they are working for is making profit, being victims of their narrow perspective — as they are more or less likely to be — isn't there a need for two-tier boards, the way it will be implemented for entreprises over a certain size in Germany, Austria, Denmark, Sweden, and Norway after WW2?
See German Codetermination Act, 1976.
16) Is syndicalism a mere psychological fantasy? When the workers organize into a movement to uphold an amelioration in the working conditions, isn't that telltale about the need for better working conditions?
I have to do some research about the relationship between offer and demand in the market economy AND in the job market & workplace.
+ See Douglas McGregor's management theory X and Y.
17) An argument about the danger of removing the incentive by reducing the receipts and taxing big, successful business. ('By eliminating the hope of profit one makes impossible the functioning of the entire system of entrepreneurship.')
------
You can browse my reading updates for more specifics on the matter!
Does government intervention serve or frustrate the intention of those who want to put it into operation?
Ludwig von Mises' thesis:
Government intervention merely disrupts the market economy in the short run and destroys it completely in the long run. Governements should not concern themselves with matters outranging regal powers & the protection of life and property against violence and fraud.
LvM posits that the unhampered market economy is better suited to satisfy human needs, more beneficial to the individual & general welfare.
In the words of the editor:
'In this book, Mises shows how government intervention results in consequences its proponents did not intend. It hampers production, causing artificial scarcities. It creates special interest groups. It leads to inflation, domestic economic conflict, a militant nationalism, international conflict, and even war.'
In the words of LvM's himself:
'Despite all attempts to invalidate this argument, the fact remains indisputable. In the unhampered market, forces are at work which tend to put every means of production to the use in which it is most beneficial for the satisfaction of human wants. When the authority interferes with this process in order to bring about a different use of the productive factors it can only impair the supply, it cannot improve it.'
'The unhampered market economy is not a system which would seem commendable from the standpoint of the selfish group interests of the entrepreneurs and capitalists. It is not the particular interests of a group or of individual persons that require the market economy, but regard for the common welfare. It is not true that the advocates of the free-market economy are defenders of the selfish interests of the rich. The particular interests of the entrepreneurs and capitalists also demand interventionism to protect them against the competition of more efficient and active men. The free development of the market economy is to be recommended, not in the interest of the rich, but in the interest of the masses of the people.'
-----
MY OPINION:
Actually, I am favourably impressed by the way the essay is actually written compared to what I was expecting from 'praxeology'. LvM does not rely on statistics or numerical data but uses an array of examples drawn from Ancien Régime economy, various European crises and the era when the book was written (1940), which informed quite a lot of his arguments against socialism.
The author uses historical examples as to the development of liberalism & conceptualization of the laws of the market, corporativism, syndicalism, inflation, unemployment. The key notions debated are carefully defined and each part of the book methodically, clearly organized.
Still, part of the book feel dated indeed and the outview lacks scope or better said, the proper tools to deal efficiently with the current state of affairs, be it only in the narrow field of economics. Also, even though they are always painstakingly defined, some terms are misused ('total war') or downright fallacious (see 'asian despotism').
Finally, parts of the book felt grounded on little more than LvM's personal opinions regarding a hypothetically pure socialism or capitalism.
In short, I appreciate LvM's essay much more for the questions it raised than for the answers it offered, neglecting some issues ingrained in the 'unhampered' market economy. More important, it clearly showed I have some research to do on a wealth of different matters.
-----------------------------------
SOME OF THE QUESTIONS RAISED :
1) What manner of taxes are to fund the State? Flat tax? Progressive tax? Why? When is it considered as interfering? And interfering with what exactly?
2) Can political power exist without/outside economical power?
3)
' in actuality the consumers, not the entrepreneurs, determine the direction and scope of production' + '[The consumers] take away the means of production from those entrepreneurs who do not know how to use them best in the service of the consumers and transfer them to those who know how to make better use of them.'He concludes : Pleas for the abandonment of egoism should be adressed to the consumers, not the entrepreneurs because they are what influences entrepreneurs.
Posits again absolute severance of agency between entrepreneurs & customers consuming their goods/services + absolute personal responsibility for the choices made by each of them.
Is it a sheerly personal decision actually? Are these needs not pliable? Can't entrepreneurs manufacture the needs of their consumers-to-be?
See supplier-induced demand, modern marketing : advertisement, agressive pricing, temporary sale below cost, planned obsolescence, addiction & behavioral targeting, addiction by design & compulsion loops...
4)
'The English and French liberals and the fathers of the U.S. Constitution insisted upon the protection of private property, not to further the selfish interests of one class, but rather for the protection of the whole people and because they saw the welfare of the nation and of each individual most secure in the system of a market economy.'
See Piketty on the history of proprietarism, or how old feudal rights have been confirmed as modern property rights in France.
Isn't private property allowed to exist and prosper because of a series of factors not depending on the capitalist or the entrepreneur? If so, why should ownership, propriety be held as entirely due to the entrepreneur/capitalist and held as immutable, unalienable?
5) I have to do research about 'the constant recomposition of the entrepreneurial elite'.
6) Are the prices, wages, interest rates being the result of the workings of the market to be considered the sole common denominator and only reliable indicator of economic action?
7) Are all activities bound to be profit-oriented?
Or, in von Mises' words, are these branches more beneficial to the general welfare, when privatized? See Energy, power and water supply, post offices, hospitals, schools, communications...
See privatization of water supplies in South America.
8)
'If the individual looks out for his own interest within the framework provided by private property and market exchange he is doing everything the society expects of him.'A traditional case for the beehive. Is the sum of all private interests beneficial to society in general? I ask for proof other than the Fable of the Bees that unbridled ('unhampered') market (with the State able or not to curb fraud, violence, malice against property) leads to public benefit...
9)
'The political parties may represent different opinions about what helps the whole nation, but they should not represent the particular selfish interests of certain districts or pressure groups.
The parliaments of interventionist countries are today quite different from this old ideal. There are representatives of silver, cotton, steel, farming, and labor. But no legislator feels it his duty to represent the nation as a whole.''
Is politics without a form of party politics a workable system? Isn't it something akin to dictature/enlightened despotism more often than not?...
10)
'Beyond the realm of private property and market exchange lies the realm of unlawful actions; there society has erected barriers for the protection of private property and of the market against force, fraud, and malice. Here freedom no longer reigns, but compulsion. Here, not everything is permitted, here a line is drawn between the lawful and the unlawful. Here the police power is ready to intervene. If it were any different every individual would be free to break through the barriers of the legal order.'
[Richard wrote:] ...as opposed to the current system where the very wealthy are the only ones allowed to flout the law unpunished.
[P.E. wrote:] That must be the State has failed then. Unless the State is necessarily partial because it consists of entrepreneurs, too? Unless something replaced the State as the authority? (see below)
'Command and interdiction need not ostensibly emanate from the government. It may happen that commands and interdictions emanate from a different source and that this other agency also supplies the power apparatus to enforce its orders. If the authority condones this procedure or even supports it, then the situation is the same as that created by direct governmental orders. If the government does not want to consent and opposes this action with its power apparatus, but without avail, this is evidence that another authority has succeeded in establishing itself and in contesting governmental supremacy.'
What about governments serving the interest of entrepreneurs, when not entrepreneurs themselves?
'Frequently, we hear the assertion that the democratic institutions are only a disguise for the "dictatorship of capital." The Marxists have used this slogan for a long time. Georges Sorel and the syndicalists repeated it. Today Hitler and Mussolini ask the nations to rise up against "plutodemocracy." In answer to this it suffices to point out that in Great Britain, in the British Dominions, and in the United States the elections are completely free of coercion. Franklin D. Roosevelt was elected president by a majority of the voters. Nobody forced any American citizen to vote for him. Nobody prevented anyone from voicing publicly what he considered an argument against the re-election of Roosevelt. The citizens of America were free to decide, and they did decide.'
The conditions might have been different in 1940, still, you have to consider the amount of private & corporate tax-free donations funding political campaigns. You can't understate the importance of such subsides & publicity in democratical elections (e.g. in the USA & France) : you can't just infer democracy from people freely voting for their political representatives, you have to take the process as a whole.
That doesn't invalidate LvM' whole point but calls for nuance & dicussing the necessary conditions for a meaningful democracy to take place.
11) Concerning LvM's arguments against state regulations about product quality or protectionism, 2 instances of interventionism.
- Health measures (abestos in construction industry, lead in toys, railings..., radium, planned obsolescence). Is that to be left as the sole responsibility of the consumer, when pricing and elimitation of concurrence restricts his leeway? ...
- Is it to the interest of consumers that some branches of their national/local economy disappear? (small shops, bookstores, local agriculture...) What are the effects of it on a sheer economical point of view? On consumption? Since some consumers are no longer working in that branch.
Former customers/consumers no longer participating in the economy.
LvM's answer to that issue:
'Every technological progress first injures vested interests of entrepreneurs, capitalists, landowners, or workers. But if the desire to prevent such injuries is to prompt measures to prevent the development of new techniques, this would in the long run harm not only the interests of all citizens, but also of those who supposedly were to be benefited.'
- Is it done in the interest of the consumers not to somewhat preserve national and local production sites & a home market, should supplies from foreign countries cease, for a given period of time? In case of production shortage overseas, let's say, of farming products, or of healthcare supplies (masks...) for instance?
- It is certainly beneficial to have several suppliers for a given product to satisfy demand, but still, by preserving key sectors, restrictive measures (protectionism, public aid) can ensure local and temporary improvement of the state of supplies especially in critical situations. Prove me wrong.
12) Research to do about allegedly successful measures of price control : Lang Law 1981, 'BQP' measures for French Overseas territories, 2012, HLM (social housing, allowed to exist by tax exemption, public credit...).
More research to do about affordable accommodation today (monstrous waiting files in Berlin for a flat on 28/11/2019...), SMIC (minimum wages), syndicalism & their effects, both positive and negative.
13) Is it to say whatever doesn't benefit the unbrindled market is cronyism, favouritism, expediency? Are there no other interests at play? Is politics even needed if all should go through the 'consumer's ballot'?
14) On LvM's conception of a just, helpful tax :
'Unfortunately the state will need more money to cover its expenditures. In any case, you will have to carry most of the burden because you are receiving and consuming the largest share of the total national income. You have to choose between two methods. Either you restrict your consumption immediately, or you consume the capital of the wealthy first and then a bit later you will suffer from falling wages' & 'A tax system which would serve the real interests of the wage earners would tax only that part of income which is being consumed, and not saved and invested. High taxes on the spending of the rich do not injure the interests of the masses; however, every measure which impedes the formation of capital or which consumes capital does injure them.'
A flat tax, that is. I'm not that sure it supports the interest of low wage-earners in the short to middle-run at the bare minimum.
Also, in the long run, the success of such a measure still depends on capital owners willing to raise wages in the face of the need for international competitiveness.
15) If workers are oblivious of the real state of affairs or don't know the whether the business they are working for is making profit, being victims of their narrow perspective — as they are more or less likely to be — isn't there a need for two-tier boards, the way it will be implemented for entreprises over a certain size in Germany, Austria, Denmark, Sweden, and Norway after WW2?
See German Codetermination Act, 1976.
16) Is syndicalism a mere psychological fantasy? When the workers organize into a movement to uphold an amelioration in the working conditions, isn't that telltale about the need for better working conditions?
I have to do some research about the relationship between offer and demand in the market economy AND in the job market & workplace.
+ See Douglas McGregor's management theory X and Y.
17) An argument about the danger of removing the incentive by reducing the receipts and taxing big, successful business. ('By eliminating the hope of profit one makes impossible the functioning of the entire system of entrepreneurship.')
------
You can browse my reading updates for more specifics on the matter!
March 10, 2021
Nesta obra, Mises objetiva tratar da chamada "terceira via", um ponto supostamente equidistante entre Capitalismo e Socialismo. Por pura lógica, percebemos que essa condição não é nada mais do que socialismo.
Mises se isenta de julgamentos de valor, mas ressalta que tentativas de ser um "bom" empresário para os pobres, resulta em carência de produtos, que pobres mais necessitados serão excluídos, por conta da demanda alta, de seus produtos baratos que o "bom" empresário venda no mercado a preços abaixo dos concorrentes.
Medidas restritivas à produção devem ser consideradas simplesmente despesas, não política econômica. A interferência via controle de preços também gera compradores que não conseguem comprar mesmo estando dispostos a pagar muito, e também vendedores que não conseguem vender a um preço mais baixo, gerando escassez dos bens.
Mises lembra que até Marx sabia que era impossível através de pressão sindical aumentar o salário de todos os trabalhadores de forma duradoura, acima dos níveis de mercado.
Sobre os ciclos, Mises diz que não é inerente à economia de mercado os aumentos/depressões artificiais, e sim consequência das intervenções com propósito de propiciar empréstimos a juros baratos através da expansão do crédito.
Mises ensina que os cidadãos pagam duas vezes quando ocorre algum subsídio a empresas. Primeiro pagando diretamente os subsídios, como "contribuintes", e depois de novo como consumidores, comprando produtos inferiores/mais caros ou reduzindo o consumo.
Mises diz que o corporativismo real nunca existiu, nem na Itália fascista, e é impossível de existir, pois exige uma corporação que seja monopolista e autônoma, que tende na realidade a cair para o sindicalismo. Ambos pressupõe a estática das condições de produção vigentes.
Interessante que Mises não conseguiu enxergar o que ele mesmo criticou, apontando corretamente que caso houvesse uma votação para igualar salários ou outra causa que prejudique diretamente a minoria capitalista, é óbvio que a maioria escolheria o que interessa, ou seja, seriam escolhas democráticas, ainda que injustas, mas Mises considera a democracia "o corolário da economia de mercado nos assuntos internos de um país".
Mostra que só é possível um agressor travar uma guerra total com a implantação do socialismo. Objeta-se a guerra, que é uma situação de queima exaustiva não apenas de vidas, mas de capital.
Embora tenha aspectos já tratados em outras obras do autor, é um bom livro, concluído de forma certeira no posfácio de Fábio Barbieri com o resumo da percepção do público no fracasso das medidas intervencionistas como: "ganância dos empresários, falta de rigor na aplicação da lei e corrupção", exatamente como ocorre hoje com qualquer intervencionista que não tem coragem de se chamar de socialista.
Mises se isenta de julgamentos de valor, mas ressalta que tentativas de ser um "bom" empresário para os pobres, resulta em carência de produtos, que pobres mais necessitados serão excluídos, por conta da demanda alta, de seus produtos baratos que o "bom" empresário venda no mercado a preços abaixo dos concorrentes.
Medidas restritivas à produção devem ser consideradas simplesmente despesas, não política econômica. A interferência via controle de preços também gera compradores que não conseguem comprar mesmo estando dispostos a pagar muito, e também vendedores que não conseguem vender a um preço mais baixo, gerando escassez dos bens.
Mises lembra que até Marx sabia que era impossível através de pressão sindical aumentar o salário de todos os trabalhadores de forma duradoura, acima dos níveis de mercado.
Sobre os ciclos, Mises diz que não é inerente à economia de mercado os aumentos/depressões artificiais, e sim consequência das intervenções com propósito de propiciar empréstimos a juros baratos através da expansão do crédito.
Mises ensina que os cidadãos pagam duas vezes quando ocorre algum subsídio a empresas. Primeiro pagando diretamente os subsídios, como "contribuintes", e depois de novo como consumidores, comprando produtos inferiores/mais caros ou reduzindo o consumo.
Mises diz que o corporativismo real nunca existiu, nem na Itália fascista, e é impossível de existir, pois exige uma corporação que seja monopolista e autônoma, que tende na realidade a cair para o sindicalismo. Ambos pressupõe a estática das condições de produção vigentes.
Interessante que Mises não conseguiu enxergar o que ele mesmo criticou, apontando corretamente que caso houvesse uma votação para igualar salários ou outra causa que prejudique diretamente a minoria capitalista, é óbvio que a maioria escolheria o que interessa, ou seja, seriam escolhas democráticas, ainda que injustas, mas Mises considera a democracia "o corolário da economia de mercado nos assuntos internos de um país".
Mostra que só é possível um agressor travar uma guerra total com a implantação do socialismo. Objeta-se a guerra, que é uma situação de queima exaustiva não apenas de vidas, mas de capital.
Embora tenha aspectos já tratados em outras obras do autor, é um bom livro, concluído de forma certeira no posfácio de Fábio Barbieri com o resumo da percepção do público no fracasso das medidas intervencionistas como: "ganância dos empresários, falta de rigor na aplicação da lei e corrupção", exatamente como ocorre hoje com qualquer intervencionista que não tem coragem de se chamar de socialista.
March 1, 2016
This is a short essay written at the beginning of World War II. Mises moves in the basic problems of interventionism. The author starts by explaining the difference between the capitalist system, socialism and interventionism. The author places the interventionism as an intermediate state between the "pure" market economy and a "pure" socialism. He also explains the differences between the Soviet model of socialism and German.
Ludwig von Mises in the following sections explain the problems associated with various forms of intervention. Moves such topics as regulations, price controls, subsidies and credit expansion. The author also explains what is syndicalism and corporatism.
At the end of Mises explains the reason for the victory of the Third Reich at the beginning of the war. Hitler reduced consumption to a minimum, putting the economy of Reich on war economy. Socialists, of course, argue that the cause of the defeat of the Allies was that they kept the capitalist economy not socialist. Mises refutes this claim, saying that progressives from countries hostile to the Reich led to the confiscation of 100% of profits from the arms industry (because the profit from the war is immoral), which completely discouraged entrepreneurs to adjusting their factories to the production of armaments when it was needed. By this, the Allies had big problems with weapons. On the evidence of the effectiveness of private arms manufacturers autor gives the situation of the First World War, when private companies were able to produce a much faster and cheaper than the state. In addition, the Allies instead of proceeding to the war, preferred to send planes with leaflets to German workers, to persuade the Germans to overthrow Hitler. But they were not aware that Hitler was elevated to power mostly by German workers witch wanted to remove evil jewish bankers from society, because they thinked that they exploited them.
The book is simple in perception, which is suitable for people who begin their adventure with free-market economy.
//polish
Jest to krótki esej napisany na początku II wojny światowej. Mises porusza w niej podstawowe problemy związane z interwencjonizmem. Autor rozpoczyna od wyjaśnienia różnicy między systemem kapitalistycznym, socjalistycznym i interwencjonizmem. Autor umieszcza interwencjonizm jako stan pośredni między "czystą" gospodarką rynkową a "czystym" socjalizmem. Wyjaśnia też różnice między sowieckim modelem socjalizmu a niemieckim.
Ludwig von Mises w kolejnych rozdziałach wyjaśnia problemy związane z różnymi formami interwencjonizmu. Porusza takie tematy jak regulacje, kontrola cen, ekspansja kredytowa oraz subwencje. Autor wyjaśnia także czym jest syndykalizm i korporacjonizm.
Pod koniec Mises wyjaśnia także przyczyny zwycięstwa III Rzeszy w początkach wojny. Hitler ograniczył konsumpcję do minimum, przestawiając gospodarkę Rzeszy na gospodarkę wojenną. Socjaliści oczywiście twierdzą, że przyczyną klęski aliantów było to, że trzymali się gospodarki kapitalistycznej a nie socjalistycznej. Mises obala te twierdzenie, twierdząc że postępowcy z krajów wrogich Rzeszy doprowadzili do 100% konfiskaty zysków z przemysłu zbrojeniowego(ponieważ zysk z wojny jest niemoralny), co całkowicie zniechęciło przedsiębiorców do przestawiania swoich fabryk na produkcję zbrojeniową kiedy była taka potrzeba. Przez to alianci mieli duże problemy z uzbrojeniem. Na dowód skuteczności prywatnych producentów broni podaje sytuację z I wojny światowej, kiedy prywatne firmy były wstanie produkować znacznie szybciej i taniej niż państwowe. Dodatkowo, alianci zamiast przystąpić do wojny, woleli wysyłać samoloty z ulotkami do niemieckich robotników, aby przekonać Niemców do obalenia Hitlera. Nie byli jednak świadomi, że Hitler został wyniesiony do władzy właśnie przez niemieckich robotników, którzy chcieli usunąć złych żydowskich bankierów ze społeczeństwa, ponieważ uważali że byli przez nich wyzyskiwani.
Książka jest prosta w odbiorze, przez co nadaje się dla osób, które rozpoczynają swoją przygodę z wolnorynkową ekonomią.
Ludwig von Mises in the following sections explain the problems associated with various forms of intervention. Moves such topics as regulations, price controls, subsidies and credit expansion. The author also explains what is syndicalism and corporatism.
At the end of Mises explains the reason for the victory of the Third Reich at the beginning of the war. Hitler reduced consumption to a minimum, putting the economy of Reich on war economy. Socialists, of course, argue that the cause of the defeat of the Allies was that they kept the capitalist economy not socialist. Mises refutes this claim, saying that progressives from countries hostile to the Reich led to the confiscation of 100% of profits from the arms industry (because the profit from the war is immoral), which completely discouraged entrepreneurs to adjusting their factories to the production of armaments when it was needed. By this, the Allies had big problems with weapons. On the evidence of the effectiveness of private arms manufacturers autor gives the situation of the First World War, when private companies were able to produce a much faster and cheaper than the state. In addition, the Allies instead of proceeding to the war, preferred to send planes with leaflets to German workers, to persuade the Germans to overthrow Hitler. But they were not aware that Hitler was elevated to power mostly by German workers witch wanted to remove evil jewish bankers from society, because they thinked that they exploited them.
The book is simple in perception, which is suitable for people who begin their adventure with free-market economy.
//polish
Jest to krótki esej napisany na początku II wojny światowej. Mises porusza w niej podstawowe problemy związane z interwencjonizmem. Autor rozpoczyna od wyjaśnienia różnicy między systemem kapitalistycznym, socjalistycznym i interwencjonizmem. Autor umieszcza interwencjonizm jako stan pośredni między "czystą" gospodarką rynkową a "czystym" socjalizmem. Wyjaśnia też różnice między sowieckim modelem socjalizmu a niemieckim.
Ludwig von Mises w kolejnych rozdziałach wyjaśnia problemy związane z różnymi formami interwencjonizmu. Porusza takie tematy jak regulacje, kontrola cen, ekspansja kredytowa oraz subwencje. Autor wyjaśnia także czym jest syndykalizm i korporacjonizm.
Pod koniec Mises wyjaśnia także przyczyny zwycięstwa III Rzeszy w początkach wojny. Hitler ograniczył konsumpcję do minimum, przestawiając gospodarkę Rzeszy na gospodarkę wojenną. Socjaliści oczywiście twierdzą, że przyczyną klęski aliantów było to, że trzymali się gospodarki kapitalistycznej a nie socjalistycznej. Mises obala te twierdzenie, twierdząc że postępowcy z krajów wrogich Rzeszy doprowadzili do 100% konfiskaty zysków z przemysłu zbrojeniowego(ponieważ zysk z wojny jest niemoralny), co całkowicie zniechęciło przedsiębiorców do przestawiania swoich fabryk na produkcję zbrojeniową kiedy była taka potrzeba. Przez to alianci mieli duże problemy z uzbrojeniem. Na dowód skuteczności prywatnych producentów broni podaje sytuację z I wojny światowej, kiedy prywatne firmy były wstanie produkować znacznie szybciej i taniej niż państwowe. Dodatkowo, alianci zamiast przystąpić do wojny, woleli wysyłać samoloty z ulotkami do niemieckich robotników, aby przekonać Niemców do obalenia Hitlera. Nie byli jednak świadomi, że Hitler został wyniesiony do władzy właśnie przez niemieckich robotników, którzy chcieli usunąć złych żydowskich bankierów ze społeczeństwa, ponieważ uważali że byli przez nich wyzyskiwani.
Książka jest prosta w odbiorze, przez co nadaje się dla osób, które rozpoczynają swoją przygodę z wolnorynkową ekonomią.
September 30, 2015
Um belo ponto de vista, ainda que eu ache que faltam exemplos históricos para ilustrar melhor os pontos de vista do autor. Acho que o livro é um pouco contaminado pelo momento momento político em que foi escrito, por isso seria bastante importante ler algo mais recente dele e, pricipalmente mais denso, pois o livro deixa muitas lacunas sobre diversas formas de intervencionismo. Um dia eu talvez crie coragem para ler o "Ação Humana", escrito 30 anos depois.
July 11, 2020
This book is a well rounded and easy-to-read analysis of the feasibility of interventionism as a mid-way between market economy and socialism. It does not pry on the moral or ethical reasons behind interventionism, but simply describes the reasons why it is not a suitable method for achieving that which the government aims.
January 26, 2018
It's a excellent continuation to Socialism.
Must read to every economics student.
Must read to every economics student.
December 5, 2024
Quanto mais leio sobre os livros de Misses mais entendo o mundo atual e porque chegamos onde chegamos.
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