2nd Lecture
Class Conflict and Revolutionary Socialism, Ludwig von Mises and Richard Eberling (commentary)

Marx assumed that “interests” were independent of human ideas and thoughts. He said that socialism was the ideal system for the proletariat. He said class interests determine the thinking of individuals and that this situation causes irreconcilable conflicts between the various classes. Marx then returned to the point at which he had started—namely, that socialism is the ideal state.

The fundamental concept of the Communist Manifesto (1848) was that of “class” and “class conflict.” But Marx didn’t say what a “class” was. Marx died in 1883, 35 years after the publication of the Communist Manifesto. In those 35 years he published many volumes, but in not one of them did he say what he meant by the term “class.” After Marx’s death, Friedrich Engels published the unfinished manuscript of the third volume of Marx’s Das Kapital. Engels said this manuscript, on which Marx had stopped work, many years before he died, had been found in Marx’s desk after his death. In one three-page chapter in that volume, Marx tells us what a “class” was not. But you may search through all his writings to learn what a “class” was without ever finding out. In fact, “classes” don’t exist in nature. It is our thinking—our arranging in categories—that constructs classes in our minds. The question is not whether social classes exist in the sense of Karl Marx; the question is whether we can use the concept of social classes in the way in which Karl Marx meant it. We can’t.

Marx did not see that the problem of the “interest” of an individual, or of a class, cannot be solved simply by referring to the fact that there is such an interest and that men must act according to their interests. Two questions must be asked: (1) Toward what ultimate ends do these “interests” lead people? (2) What methods do they want to apply in order to reach these ends?

The First International was a small group of people, a committee of a few men in London, friends and enemies of Karl Marx. Someone suggested that they cooperate with the British labor-union movement. In 1865, Karl Marx read at the meeting of the International Committee, a paper, Value, Price, and Profit, one of his few writings originally written in English. In this paper, he pointed out that the methods of the union movement were very bad and must be changed. Paraphrasing: “The unions want to improve the fate of the workers within the framework of the capitalist system—this is hopeless and useless. Within the framework of the capitalist system there is no possibility of improving the state of the workers. The best the union could achieve in this way would be some short-term success. The unions must abandon this ‘conservative’ policy; they must adopt the revolutionary policy. They must fight for the abolition of the wage society as such and work for the coming of socialism.” Marx didn’t have the courage to publish this paper during his lifetime; it was published only after his death by one of his daughters. He didn’t want to antagonize the labor unions; he still had hopes they would abandon their theory.

Here is an obvious conflict of opinions among the proletarians themselves concerning the right means to use. The proletarian unions and Marx disagreed as to what was in the “interest” of the proletarians. Marx said that the “interest” of a class was obvious—there could be no doubt about it—everyone would know it. Then here comes a man who doesn’t belong to this proletarian class at all, a writer and a lawyer who tells the unions they were wrong. “This is bad policy,” he said. “You must radically change your policy.” Here the whole idea of the class breaks down, the idea that an individual may sometimes err but that a class as a whole can never err.

Criticisms of Marxian doctrines have always been superficial. They haven’t pointed out how Marx contradicted himself and how he failed to explain his ideas. Böhm-Bawerk’s critique[1] was good but he didn’t cover the entire system. Critics of Marx didn’t even discover Karl Marx’s most manifest contradictions.

Marx believed in the “iron law of wages.” He accepted that as the fundamental basis of his economic doctrine. He didn’t like the German term for this law, the “brazen” law of wages, about which Ferdinand Lassalle [1825–1864] had published a pamphlet. Karl Marx and Ferdinand Lassalle were not friends; they were competitors, very serious competitors. Marx said Lassalle’s only contribution was the term itself, the “brazen” law of wages. And what was more, the term, was borrowed, borrowed from the dictionary and from Goethe.[2]

The “iron law of wages” still survives in many textbooks, in the minds of politicians, and consequently in many of our laws. According to the “iron law of wages,” the wage rate is determined by the amount of food and other necessities required for the preservation and reproduction of life, to support the workers’ children until they can themselves work in the factories. If wage rates rise above this, the number of workers would increase and the increased number of workers would bring wage rates down again. Wages cannot drop below this point because there would then develop a shortage of labor. This law considers the worker to be some kind of microbe or rodent without free choice or free will.

If you think it is absolutely impossible under the capitalist system for wages to deviate from this rate, how then can you still talk, as Marx did, about the progressive impoverishment of the workers as being inevitable? There is an insoluble contradiction between the Marxian idea of the iron law of wage rates, according to which wages will remain at a point at which they are sufficient to support the progeny of workers until they can themselves become workers, and his philosophy of history, which maintains that the workers will be more and more impoverished until they are driven to open rebellion, thus bringing about socialism. Of course, both doctrines are untenable. Even 50 years ago the leading socialist writers were forced to resort to other elaborate schemes in the attempt to support their theories. What is amazing is that, during the century since Marx’s writings, no one has pointed out this contradiction. And this contradiction is not the only contradiction in Marx.

What really destroyed Marx was his idea of the progressive impoverishment of the workers. Marx didn’t see that the most important characteristic of capitalism was large-scale production for the needs of the masses; the main objective of capitalists is to produce for the broad masses. Nor did Marx see that under capitalism the customer is always right. In his capacity as a wage earner, the worker cannot determine what is to be made. But in his capacity as a customer, he is really the boss and tells his boss, the entrepreneur, what to do. His boss must obey the orders of the workers as they are members of the buying public. Mrs. Webb,[3] like other socialists, was the daughter of a well-to-do businessman. Like other socialists, she thought her father was an autocrat who gave orders to everybody. She didn’t see that he was subject to the sovereignty of the orders of the customers on the market. The “great” Mrs. Webb was no smarter than the dumbest messenger boy who sees only that his boss gives orders.

Marx had no doubt as to what the ends were toward which men aim. Nor did he have any doubts as to the best way to attain these ends. How is it that a man who read so much and interrupted his reading only to write, didn’t realize the discrepancy in his ideas?

To answer that question, we must go back to the thinking of his time. That was the time of Charles Darwin’s Origin of the Species [1859]. It was the intellectual fashion of that day to look upon men merely from the point of view of their membership in the zoological class of mammals, which acted on the basis of instincts. Marx didn’t take into account the evolution of mankind above the level of very primitive men. He considered unskilled labor to be the normal type of labor and skilled labor as the exception. He wrote in one of his books that progress in the technological improvement of machines causes the disappearance of specialists because the machine can be operated by anyone; it takes no special skill to operate a machine. Therefore, the normal type of man in the future will be the non-specialist.

With regard to many of his ideas, Marx belonged to much earlier ages, especially in constructing his philosophy of history. Marx substituted for Hegel’s evolution of Geist the evolution of the material factors of production. He didn’t realize that the material factors of production, i.e., the tools and machines, are actually products of the human mind. He said these tools and machines, the material productive forces, inevitably bring about the coming of socialism. His theory has been called “dialectical materialism,” abbreviated by the socialists to “diamet.”

[In an aside, Dr. Mises told of visiting a school in Mexico, an “escuela socialista,” a “socialist school.” Mises asked the school’s Mexican dean what “socialist school” meant. The dean explained that Mexican law required schools to teach the Darwinian doctrine of evolution and dialectical materialism. Then he commented on the provision in the law making this requirement and on the school system itself: “There is a great difference between the letter of the law and the practice. Ninety percent of the teachers in our schools are female and most of them are practicing Catholics.”]

Marx reasoned from the thesis to the negation of the thesis to the negation of the negation. Private ownership of the means of production by every individual worker was the beginning, the thesis. This was the state of affairs in a society in which every worker was either an independent farmer or an artisan who owned the tools with which he was working. Negation of the thesis—ownership under capitalism—when the tools were no longer owned by the workers, but by the capitalists. Negation of the negation was ownership of the means of production by the whole society. Reasoning in this way, Marx said he had discovered the law of historical evolution. And that is why he called it “scientific socialism.”

Marx branded all previous socialists “utopian socialists” because they tried to point out why socialism was better. They wanted to convince their fellow citizens to their view because they expected people would adopt the socialist social system if they were convinced it was better. They were “utopians,” Marx said, because they tried to describe the future earthly paradise. Among the forerunners of Marx whom he considered “utopians” were Saint-Simon, a French aristocrat; Robert Owen [1757–1858], a British manufacturer; and Charles Fourier [1772–1837], a Frenchman who was without doubt a lunatic. (Fourier was called the “fou [fool] du Palais-Royal.” He used to make such statements as “In the age of socialism, the ocean will no longer be salt but lemonade.”) Marx considered these three as great forerunners. But, he said, they didn’t realize that what they were saying was just “utopian.” They expected the coming of socialism because of a change in the opinions of the people. But for Marx, the coming of socialism was inevitable; it would come with the inevitability of nature.

On the one hand, Karl Marx wrote of the inevitability of socialism. But on the other hand, he organized a socialist movement, a socialist party, declared again and again that his socialism was revolutionary, and that the violent overthrow of the government was necessary to bring about socialism.

Marx borrowed his metaphors from the field of gynecology. The socialist party is like obstetrics, Marx said; it makes the coming of socialism possible. When asked if you consider the whole process inevitable, why do you not favor evolution instead of revolution, the Marxists reply, “There are no evolutions in life. Is not birth itself a revolution?”

According to Marx, the goal of the socialist party was not to influence, but only to help the inevitable. But obstetrics itself influences and changes conditions. Obstetrics has actually brought about progress in this branch of medicine, and even saved lives. And by saving lives it could be said obstetrics has actually changed the course of history.

The term “scientific” acquired prestige during the course of the nineteenth century. Engels’ Anti-Dühring (1878) became one of the most successful books among the writings of philosophical Marxists. One chapter in this book was reprinted as a pamphlet under the title “The Development of Socialism from Utopia to Science,” and it had enormous success. Karl Radek [1885–1939], a Soviet Communist, later wrote a pamphlet called “The Development of Socialism, from Science to Action.”

Marx’s doctrine of ideology was concocted to discredit the writings of the bourgeoisie. [Tomás] Masaryk [1850–1937] of Czechoslovakia was born of poor people, farmers and workers, and he wrote about Marxism. Yet the Marxians called him a bourgeois. How could he be considered “bourgeois” if Marx and Engels called themselves “proletarian”?

If the proletarians must think according to the “interests” of their class, what does it mean if there are disagreements and dissent among them? The confusion makes the situation very difficult to explain. When there is dissent among proletarians, they call a dissenter a “social traitor.” After Marx and Engels, the great man of the Communists was a German, Karl Kautsky [1854–1938]. In 1917, when Lenin tried to revolutionize the whole world, Karl Kautsky was opposed to the idea. And because of this disagreement, the former great man of the party became overnight a “social traitor,” and he was called that as well as many other names.

This idea is like that of the racists. The German racists declared that a definite set of political ideas were German and every real German must necessarily think according to this particular set of ideas. This was the Nazi idea. According to the Nazis, the best situation was to be in a state of war. But some Germans—Kant, Goethe, and Beethoven, for instance—had different “un-German” ideas. If not every German must think in a certain way, who is to decide which ideas are German and which are un-German? The answer can only be that an “inner voice” is the ultimate standard, the ultimate yardstick. This position necessarily leads to conflicts that must result in civil, or even international, war.

There were two groups of Russians, both of whom considered themselves proletarians—the Bolsheviks and the Mensheviks. The only method to “settle” disagreements between them was to use force and liquidation. The Bolsheviks won. Then within the ranks of the Communist Bolsheviks there arose other differences of opinion—between Trotsky[4] and Stalin—and the only way to resolve their conflicts was a purge. Trotsky was forced into exile, trailed to Mexico, and there in 1940 he was hacked to death. Stalin originated nothing; he went back to the revolutionary Marx of 1859—not to the interventionist Marx of 1848.

Unfortunately, purges are not something which happen just because men are imperfect. Purges are the necessary consequences of the philosophical foundation of Marxian socialism. If you cannot discuss philosophical differences of opinion in the same way you discuss other problems, you must find another solution—through violence and power. This refers not only to dissent concerning policies, economic problems, sociology, law, and so on. It refers also to problems of the natural sciences. The Webbs, Lord and Lady Passfield, were shocked to learn that Russian magazines and papers dealt even with problems of the natural sciences from the point of view of the philosophy of Marxism-Leninism-Stalinism. For instance, if there is a difference of opinion with regard to science or genetics, it must be decided by the “leader.” This is the necessary unavoidable consequence of the fact that, according to Marxist doctrine, you do not consider the possibility of dissent among honest people; either you think as I do, or you are a traitor and must be liquidated.

The Communist Manifesto appeared in 1848. In that document, Marx preached revolution; he believed the revolution was just around the corner. He believed then that socialism was to be brought about by a series of interventionist measures. He listed ten interventionist measures—among them the progressive income tax, the abolition of the rights of inheritance, agricultural reform, and so on. These measures were untenable, he said, but necessary for socialism to come.

Thus, Karl Marx and Engels believed in 1848, that socialism could be attained by interventionism. By 1859, eleven years after the Communist Manifesto, Marx and Engels had abandoned the advocacy of interventions; they no longer expected socialism to come from legislative changes. They wanted to bring about socialism by a radical change overnight. From this point of view, followers of Marx and Engels considered later measures—the New Deal, the Fair Deal, and so forth—to be “petty bourgeois” policies. In the 1840s Engels had said British labor laws were a sign of progress and a sign of the breakdown of capitalism. Later they called such interventionist measures or interventionist policy (Sozialpolitik) very bad.

In 1888—40 years after the publication of the Communist Manifesto—a translation was made by an English writer. Engels added some comments to this translation. Referring to the ten interventionist measures advocated in the Manifesto, he said these measures were not only untenable, as the Manifesto claimed, but precisely because they were untenable, they would necessarily push further and further toward still more measures of this kind, until eventually these more advanced measures would lead to socialism.

1st Lecture
Mind, Materialism, and the Fate of Man

The first five lectures in this series will be on philosophy, not on economics. Philosophy is important because everybody, whether or not he knows it, has a definite philosophy, and his philosophical ideas guide his actions.

The philosophy of today is that of Karl Marx [1818–1883]. He is the most powerful personality of our age. Karl Marx and the ideas of Karl Marx—ideas which he did not invent, develop, or improve, but which he combined into a system—are widely accepted today, even by many who emphatically declare that they are anti-communist and anti-Marxist. To a considerable extent, without knowing it, many people are philosophical Marxists, although they use different names for their philosophical ideas.

Marxists today speak of Marxism-Leninism-Stalinism. Volumes are written today in Russia about the contributions of [Vladimir Ilyich] Lenin [1870–1924] and [Josef] Stalin [1879–1953]. Yet the system remains what it was in the days of Karl Marx; Marxism is in effect petrified. Lenin contributed only very strong invectives against his adversaries; Stalin contributed nothing. Thus, it is questionable to call any of these contributions “new,” when we realize that the most important contribution of Marx to this philosophy was published in 1859.[1]

It takes a long time for ideas to conquer the world. When Marx died in 1883, his name was by and large unknown. A few newspapers reported in a couple of lines that Karl Marx, the author of various books, had died. Eugen von Böhm-Bawerk [1851–1914] published a critique of Marx’s economic ideas[2] in 1896, but it was only 20 years later that people began to consider Marx a philosopher.

The ideas of Marx and of his philosophy truly dominate our age. The interpretation of current events and the interpretation of history in popular books, as well as in philosophical writings, novels, plays, and so forth, are by and large Marxist. At the center is the Marxian philosophy of history. From this philosophy is borrowed the term “dialectical,” which is applied to all his ideas. But this is not so important as it is to realize what Marxist materialism means.

Materialism has two different meanings. The first refers exclusively to ethical problems. A material man is interested only in material things—food, drink, shelter—not in art, culture, and so forth. In this sense, the majority of men are materialists. The second meaning of materialism refers to a special group of solutions proposed to a basic philosophical problem—the relation between the human mind or soul on the one side, and the human body and the physiological functions of the body on the other side. Various answers to this problem have been offered—among them religious answers. We know very well that there is a connection between body and mind; surgery has proved that certain damages to the brain bring about certain changes in the function of the human mind. However, materialists of this second variety explain all manifestations of the human mind as products of the body.

Among these philosophical materialists, there are two schools of thought:

A. One school considers man as a machine. This machine variety of materialists say these problems are very simple—the human “machine” works precisely as any other machine works. A Frenchman, Julien de La Mettrie [1709–1751], wrote a book containing this idea, Man, the Machine; and today many people still want to explain all operations of the human mind, directly or indirectly, as if they were mechanical operations. For instance, see the Encyclopedia of the Social Sciences. One of the contributors, a teacher at the New School for Social Research, says the newborn child is like a Ford car, ready to run. Perhaps! But a machine, a newborn Ford, does not run by itself. A machine doesn’t achieve anything, doesn’t do anything alone—it is always men or a number of men who achieve something by means of the machine. Someone must run the machine. If the operation of the man ceases, the operation of the machine ceases too. We must ask this professor of the New School for Social Research, “Who runs the machine?” The answer would destroy the materialist machine doctrine.

People also talk sometimes about “feeding” the machine, as if it were alive. But, of course, it isn’t alive. Then too people sometimes say the machine suffers a “nervous breakdown.” But how can an object without nerves suffer a nervous breakdown? This machine doctrine has been repeated again and again, but it is not very realistic. We don’t have to deal with it because no serious men really believe it.

B. The physiological doctrine put forth by the second class of materialists is more important. This doctrine was formulated in a primitive way by Ludwig Feuerbach [1804–1872] and Karl Vogt [1817–1895] in the early days of Karl Marx. This idea was that thoughts and ideas are “simply” secretions of the brain. (No materialist philosopher ever fails to use the world “simply.” That means, “I know, but I can’t explain it.”) Today scientists know that certain pathological conditions cause certain secretions, and that certain secretions cause certain activities in the brain. But these secretions are chemically the same for all people in the same situation and condition. However, ideas and thoughts are not the same for all people in the same situation and condition; they are different.

First, ideas and thoughts are not tangible. And second, the same external factors do not produce the same reaction with everybody. An apple once fell from a tree and hit a certain young man [Isaac Newton]. This may have happened to many other young men before, but this particular happening challenged this particular young man and he developed some ideas from it.

But people do not always have the same thoughts when they are presented with the same facts. For instance, in school some learn; some don’t. There are differences in men.

Bertrand Russell [1872–1970] asked, “What is the difference between men and stones?” He said there was no difference except that men react to more stimuli than do stones. But actually there is a difference. Stones react according to a definite pattern which we can know; we can anticipate what will happen to a stone if it is treated in a certain way. But men don’t all react the same way when treated a certain way; we cannot establish such categories of actions for men. Thus, even though many people think physiological materialism is a solution, it actually leads to a dead end. If it were really the solution to this problem, it would mean that in any event we could know the way everyone would react. We cannot even imagine what the consequences would be if everybody knew what everybody else was going to do.

Karl Marx was not a materialist in the first sense—the machine sense. But the physiological idea was very popular in his day. It is not easy to know exactly what influenced Marx because he had personal hatreds and envies. Karl Marx hated Vogt, the exponent of physiological materialism. As soon as materialists like Vogt began to talk politics, Karl Marx said they had bad ideas; that meant Marx didn’t like them.

Marx developed what he thought was a new system. According to his materialist interpretation of history, the “material productive forces” (this is an exact translation of the German) are the bases of everything. Each stage of the material productive forces corresponds to a definite stage of production relations. The material productive forces determine the production relations, that is, the type of ownership and property which exists in the world. And the production relations determine the superstructure. In the terminology of Marx, capitalism or feudalism are production relations. Each of these was necessarily produced by a particular stage of the material productive forces. In 1859, Karl Marx said a new stage of material productive forces would produce socialism.

But what are these material productive forces? Just as Marx never said what a “class” was, so he never said exactly what the “material productive forces” are. After looking through his writings we find that the material productive forces are the tools and machines. In one of his books [Misère de la philosophie—The Poverty of Philosophy], written in French in 1847, Marx said “the hand mill produces feudalism—the steam mill produces capitalism.”[3] He didn’t say it in this book, but in other writings he wrote that other machines will come which will produce socialism.

Marx tried hard to avoid the geographical interpretation of progress, because that had already been discredited. What he said was that “tools” were the basis of progress. Marx and [Friedrich] Engels [1820–1895] believed that new machines would be developed which would lead to socialism. They rejoiced at every new machine, thinking that meant socialism was just around the corner. In the French book of 1847, he criticized those who attached importance to the division of labor; he said the important thing was the tools.

We must not forget that tools don’t fall from heaven. They are the products of ideas. To explain ideas, Marx said the tools, the machines—the material productive forces—reflect themselves in the brains of men and in this way ideas come. But the tools and machines are themselves the product of ideas. Also, before there can be machines, there must be division of labor. And before there can be division of labor, definite ideas must be developed. The origin of these ideas cannot be explained by something which is possible only in a society, which is itself the product of ideas.

The term “material” fascinated people. To explain changes in ideas, changes in thoughts, changes in all those things which are the products of ideas, Marx reduced them to changes in technological ideas. In this he was not original. For example, Hermann Ludwig Ferdinand von Helmholtz [1821–1894] and Leopold von Ranke [1795–1886] interpreted history as the history of technology.

It is the task of history to explain why definite inventions were not put into practice by people who had all the physical knowledge required for their construction. Why, for instance, did the ancient Greeks, who had the technical knowledge, not develop railroads?

As soon as a doctrine becomes popular, it is simplified in such a way as to be understood by the masses. Marx said everything depends on economic conditions. As he stated in his 1847 French book [The Poverty of Philosophy], he meant that the history of factories and tools developed independently. According to Marx, the whole movement of human history appears as a corollary to the development of the material productive forces, the tools. With this development of tools, the construction of society changes and as a consequence everything else changes too. By everything else, he meant the superstructure. Marxian authors, writing after Marx, explained everything in the superstructure as due to definite changes in the production relations. And they explained everything in the production relations as due to changes in the tools and machines. This was a vulgarization, a simplification, of the Marxian doctrine for which Marx and Engels were not completely responsible. They created a lot of nonsense, but they are not responsible for all the nonsense today.

What is the influence of this Marxian doctrine on ideas? The philosopher René Descartes [1596–1650], who lived in the early seventeenth century, believed that man had a mind and that man thinks, but that animals were merely machines. Marx said, of course, Descartes lived in an age in which the “Manufakturperioden,” the tools and machines, were such that he was forced to explain his theory by saying that animals were machines. Albrecht von Hailer [1708–1777], a Swiss, said the same thing in the eighteenth century (he didn’t like liberal government’s equality under law). Between these two men, lived de La Mettrie, who also explained man as a machine. Therefore, Marx’s concept that ideas were a product of the tools and machines of a particular era is easily disproved.

John Locke [1632–1704], the well-known philosopher of empiricism, declared that everything in men’s minds comes from sensual experience. Marx says John Locke was a spokesman for the class doctrine of the bourgeoisie. This leads to two different deductions from the writings of Karl Marx: (1) The interpretation he gave to Descartes is that he was living in an age when machines were introduced and, therefore, Descartes explained the animal as a machine; and (2) The interpretation he gave to John Locke’s inspiration—that it came from the fact that he was a representative of bourgeois class interests. Here are two incompatible explanations for the source of ideas. The first of these two explanations, to the effect that ideas are based on material productive forces, the tools and machines, is irreconcilable with the second, namely that class interests determine ideas.

According to Marx, everybody is forced—by the material productive forces—to think in such a way that the result shows his class interests. You think in the way in which your “interests” force you to think; you think according to your class “interests.” Your “interests” are something independent of your mind and your ideas. Your “interests” exist in the world apart from your ideas. Consequently, the production of your ideas is not truth. Before the appearance of Karl Marx, the notion of truth had no meaning for the whole historical period. What the thinking of the people produced in the past was always “ideology,” not truth.

“Les idéologues” in France were well advertised by Napoleon [1769–1821], who said everything would be all right in France but for these “idéologues.” In 1812, Napoleon was defeated. He left the army in Russia, returned alone, incognito, and appeared at the end of December 1812 in Paris. He blamed the evils that happened to his country on the bad “idéologues” which influenced the country.

Marx used ideology in a different sense. According to Marx, ideology was a doctrine thought out by members of a class. These doctrines were necessarily not truths, but merely the expressions of the interests of the class concerned. Of course, one day there will be a classless society. One class—the proletarian class—prepares the way for the classless society. The truth of today is the idea of the proletarians. The proletarians will abolish all classes and then will come the Golden Age, the classless society.

Marx called Joseph Dietzgen [1828–1888] a proletarian, but Marx would have called him a petty bourgeois if he had known more about him. Officially Marx approved all the ideas of Dietzgen, but in his private correspondence with Ferdinand Lassalle [1825–1864] he expressed some disagreement. There is no universal logic. Every class has its own logic. But, of course, the logic of the proletariat is already the true logic of the future. (These people were offended when the racists took over the same ideas, claiming that the various races have different logics but the logic of the Aryans is the true logic.)

Karl Mannheim’s [1893–1947] sociology of knowledge grew out of Hitler’s ideas. Everybody thinks in ideologies—i.e., false doctrines. But there is one class of men which enjoys a special privilege—Marx called them the “unattached intellectuals.” These “unattached intellectuals” have the privilege of discovering truths which are not ideology.

The influence of this idea of “interests” is enormous. First of all, remember that this doctrine doesn’t say men act and think according to what they consider to be their interests. Secondly, remember that they consider “interests” as independent of the thoughts and ideas of men. These independent interests force men to think and to act in a definite way. As an example of the influence this idea has on our thinking today, I might mention a U.S. Senator—not a Democrat—who said that people vote according to their “interests”; he didn’t say in accordance with what they think to be their interests. This is Marx’s idea—assuming that “interests” are something definite and apart from a person’s ideas. This idea of class doctrine was first developed by Karl Marx in the Communist Manifesto.

Neither Engels nor Marx was of the proletariat. Engels was very wealthy. He hunted for fox in a red coat—this was the pastime of the rich. He had a girlfriend he considered too far beneath him to think of marrying. She died, and her sister became her successor. He finally married the sister, but just as she was dying—only two days before her death.

Karl Marx never made much money himself. He received some money as a regular contributor to The New York Tribune. But he was almost completely supported by his friend Engels. Marx was not a proletarian; he was the son of a well-to-do lawyer. His wife, Mrs. Karl Marx [Jenny von Westphalen, 1814–1881], was the daughter of a high Prussian Junker. And Marx’s brother-in-law was the head of the Prussian police.

Thus, these two men, Marx and Engels, who claimed that the proletarian mind was different from the mind of the bourgeoisie, were in an awkward position. So they included a passage in the Communist Manifesto to explain: “When the time comes, some members of the bourgeoisie join the rising classes.” However, if it is possible for some men to free themselves from the law of class interests, then the law is no longer a general law.

Marx’s idea was that the material productive forces lead men from one stage to another, until they reach socialism, which is the end and the height of it all. Marx said socialism cannot be planned in advance; history will take care of it. In Marx’s view, those who say how socialism will work are just “utopians.”

Socialism was already defeated intellectually at the time Marx wrote. Marx answered his critics by saying that those who were in opposition were only “bourgeois.” He said there was no need to defeat his opponents’ arguments, but only to unmask their bourgeois background. And as their doctrine was only bourgeois ideology, it was not necessary to deal with it. This would mean that no bourgeois could write anything in favor of socialism. Thus, all such writers were anxious to prove they were proletarians. It might be appropriate to mention at this time also that the ancestor of French socialism, Saint-Simon,[4] was a descendant of a famous family of dukes and counts.

It is simply not true that inventions develop because people search for practical purposes and not for truths.

When Marx published his writings, German thought was dominated by George Wilhelm Friedrich Hegel [1770–1831], professor at the University of Berlin. Hegel had developed the doctrine of the philosophical evolution of history. In some respect his ideas were different from, even the very opposite to, those of Marx. Hegel was the man who destroyed German thinking and German philosophy for more than a century, at least. He found a warning in Immanuel Kant [1724–1804] who said the philosophy of history can only be written by a man who has the courage to pretend that he sees the world with the eyes of God. Hegel believed he had the “eyes of God,” that he knew the end of history, that he knew the plans of God. He said Geist (mind) develops itself and manifests itself in the course of historical evolution. Therefore, the course of history is inevitably progress from less satisfactory to more satisfactory conditions.

In 1825, Hegel said that we have reached a wonderful state of affairs. He considered the Prussian kingdom of Friedrich Wilhelm III [1770–1840] and the Prussian Union Church as the perfection of secular and spiritual government. Marx said, as Hegel had, that there was history in the past, but there will be no history anymore when we have reached a state that is satisfactory. Thus, Marx adopted the Hegelian system, although he used material productive forces instead of Geist. Material productive forces go through various stages. The present stage is very bad, but there is one thing in its favor—it is the necessary preliminary stage for the appearance of the perfect state of socialism. And socialism is just around the corner.

Hegel was called the philosopher of Prussian absolutism. He died in 1831. His school thought in terms of left and right wings. (The left didn’t like the Prussian government and the Prussian Union Church.) This distinction between the left and the right has existed since then. In the French Parliament, those who didn’t like the king’s government were seated on the left side of the assembly hall. Today no one wants to sit on the right.

Originally, i.e., before Karl Marx, the term “right” meant the supporters of representative government and civil liberties, as opposed to the “left” who favored royal absolutism and the absence of civil rights. The appearance of socialist ideas changed the meaning of these terms. Some of the “left” have been outspoken in expressing their views. For instance, Plato [427–347 BC] was frank in stating that a philosopher shall rule. And Auguste Comte [1798–1857] said that freedom was necessary in the past because it made it possible for him to publish his books, but now that these books have been published there is no longer any need for freedom. And in the same way Etienne Cabet [1788–1856] spoke of three classes of books—the bad books, which should be burned; the intermediate books, which should be amended; and the remaining “good” books. Therefore, there was great confusion as to the civil liberties to be assigned to the citizens of the socialist state. This was because Marxian ideas did not develop in countries which had civil liberties, but in countries in which the people did not have civil liberties.

Nikolai Bukharin [1888–1938], a Communist author who lived in a Communist country, wrote a pamphlet in 1917,[5] in which he said, we asked for freedom of the press, thought, and civil liberties in the past because we were in the opposition and needed these liberties to conquer. Now that we have conquered, there is no longer any need for such civil liberties. [Bukharin was tried and condemned to death in the Moscow Purge Trial of March 1938.] If Mr. Bukharin had been an American Communist, he would probably still be alive and free to write more pamphlets about why freedom is not necessary.

These peculiarities of Marxian philosophy can only be explained by the fact that Marx, although living in Great Britain, was not dealing with conditions in Great Britain, where he felt civil liberties were no longer needed, but with the conditions in Germany, France, Italy, and so on, where civil liberties were still needed. Thus we see that the distinction between right and left, which had meaning in the days of the French Revolution, no longer has any meaning.

Rational analysts — that is, admittedly a small and vanishing group — agree: the Black Lives Matter narrative about “systemic racism” in the United States is completely contrary to reality. It is propaganda constructed in order to exacerbate racial division and has about as much truth to it as the Nazis’ narrative about how Jews conspired to sabotage Germany’s World War I war effort. America is actually the least racist society on earth, one of the only countries ever to have elected a member of a formerly despised minority to its highest office, and a nation that fought a bloody civil war and labored for a century thereafter to secure equality of rights for all. So why is there so much racial tension?

As Rating America’s Presidents: An America-First Look at Who Is Best, Who Is Overrated, and Who Was An Absolute Disaster explains, the answer to that question is clear: there is so much racial tension because certain forces in the American public sphere benefit from its persistence. This is nothing new; in fact, it goes back to what should have been and what was heralded as the end of racism in the United States: the Civil Rights Act of 1964.

What no one expected in 1964 was that the Civil Rights Act would herald not the end of racial tensions in the United States, but their aggravation. As a result in large part of the act, segregation ended in the South and equality of opportunity was virtually assured, with stiff penalties for those who denied it. Yet even as actual racism was becoming unusual, civil rights activists began to insist that racism was so deeply embedded in the psyche of the nation that had done more than any other to eradicate it that much more legislation was required, including measures giving not just equality of opportunity, but equality of outcome, which would require special boosts and privileges to minorities. This all but guaranteed that racial friction would remain a feature of the American landscape.

Meanwhile, Lyndon Johnson’s Great Society and War on Poverty replaced segregation in the South with nationwide programs that were even worse for the poor, as they took away incentives to work and created a permanently unemployed underclass in which an ever-larger group of people essentially became wards of the state.

EXCLUSIVE: Trump Turns the Tables on Civil Rights Commission With Appointment of J. Christian Adams

That may have been the idea all along. The famously coarse Johnson is said to have boasted about the Civil Rights Act of 1964: “I’ll have those n—-rs voting Democratic for two hundred years.” Between that act and the War on Poverty, he certainly did create a bloc of black Americans who could be counted on to vote Democratic – at least until the advent of Donald Trump. Whether or not those votes were in the best interests of those who cast them was highly debatable, but no one dared debate it.

Then came Barack Obama. Throughout his tenure, Obama stoked racial tensions rather than calming them. When he took office, the Justice Department was pursuing a case against the New Black Panther Party for voter intimidation in Philadelphia. Obama’s attorney general, Eric Holder, abruptly dropped the case in May 2009 and refused to cooperate with further investigations, giving the impression that the Black Panthers were getting away with voter intimidation because of their race.

Obama’s response to several widely publicized incidents also exacerbated racial tensions. On July 16, 2009, black intellectual Henry Louis Gates found himself locked out of his Massachusetts home and began trying to force his way in. An officer arrived to investigate a possible break-in; Gates began berating him and was arrested for disorderly conduct. Obama claimed that the police “acted stupidly” and noted the “long history in this country of African-Americans and Latinos being stopped by police disproportionately,” although there was no indication of racial bias in the case. He invited Gates and the police officer to the White House for a “beer summit,” which the media hailed as a manifestation of his determination to heal racial divisions, when in fact it was just the opposite: he was taking a case of misunderstanding and disorderly conduct and portraying it as a racial incident requiring presidential reconciliation.

Obama also made matters worse when a young Hispanic, George Zimmerman, on February 26, 2012, shot dead a young black man, Trayvon Martin, in what was widely reported as a racial hate crime. NBC edited a recording of Zimmerman’s call to the police to give the false impression that Zimmerman was suspicious of Martin solely because he was black. Instead of trying to calm the situation, Obama stoked the idea that Zimmerman acted out of racial hatred and said, “If I had a son, he’d look like Trayvon.” Yet Zimmerman was acquitted of murder and the Justice Department declined to prosecute him for a hate crime.

As Rating America’s Presidents shows, it is two Democratic presidents, Lyndon Johnson and Barack Obama, who are primarily responsible for the high racial tension in the country today. Those who are hailed as the healers of racism actually made the condition of the patient much worse than it would have been otherwise.

Robert Spencer is the director of Jihad Watch and a Shillman Fellow at the David Horowitz Freedom Center. He is author of 19 books, including the New York Times bestsellers The Politically Incorrect Guide to Islam (and the Crusades) and The Truth About Muhammad. His latest book is The Palestinian Delusion: The Catastrophic History of the Middle East Peace Process. Follow him on Twitter here. Like him on Facebook here.

Mayor Ted Wheeler to President Trump, after the President once again offered to send federal troops to protect innocent lives and property in terrorist-laden Portland, Oregon:

“We don’t need your politics of division and demagoguery,” Wheeler wrote to Trump. “When you sent the Feds to Portland last month you made the situation far worse. Your offer to repeat that disaster is a cynical attempt to stoke fear and distract us from the real work of our city.”

Translation: “We are on the side of the looters and thugs. They are redistributing wealth and creating division. We LIKE that. Leave us alone. We WANT people to be at each other’s throats. We WANT to destroy civilization. Deep down, we hate ourselves and we hate all the glorious things our civilization has done for us. We feel like we don’t deserve it. That’s why we detest America more than we can say. You assert prosperity like it’s a GOOD thing. That makes you, President Trump, evil and hateful. The only way to achieve social justice and economic equality is to make everybody the same. Black Lives Matter and Antifa are doing that, here in Portland. We WANT that. If you actually claim it’s better for everyone of all races to live in a free, prosperous and civil enviornment, while still being unequal economically — well, President Trump, that makes you a racist. If you’re not a Marxist … then you’re a racist. P.S. Don’t think that I personally practice ANY of this when it comes to my own life. The more comfortable and wealthy I can be, the better. But I am aiding the social justice warriors in their quest for the leveling of America. So I need to be comfortable.”

Michael J. Hurd

NOTE: This is the first part of a ten part series based on the book Marxism Unmasked, by Ludwig von Mises, including nine lectures delivered at the San Francisco in 1952 under the sponsorship of The Freeman magazine. It includes commentary by Richard Eberling.–A/D

The lectures by Ludwig von Mises contained in Marxism Unmasked were delivered at the San Francisco Public Library, June 23–July 3, 1952, under the sponsorship of The Freeman magazine. They were taken down, word for word, in shorthand and transcribed by Mrs. Bettina Bien Greaves. She has very kindly made these lectures available to the Foundation for Economic Education for publication. Mrs. Greaves worked as a senior staff member at FEE for practically 50 years, only retiring in 1999. Along with her late husband, Percy L. Greaves, Jr., she was a long-time friend and associate of Ludwig von Mises. Indeed, there are few people in the world today who are as conversant with Mises’s ideas and writings as she.

The publication of these lectures has been made possible through the kind and generous continuing support of Mr. Sheldon Rose of Farmington Hills, Michigan, and the Richard E. Fox Foundation of Pittsburgh, Pennsylvania. Special thanks are due to Mr. Michael Pivarnik, Executive Director of the Fox Foundation, for his dedicated interest in the ideas of the Austrian School of Economics and Ludwig von Mises in particular.

Mrs. Beth Hoffman, managing editor of FEE’s monthly magazine, The Freeman, has once again overseen the entire preparation of the manuscript. Her eye for detail in all things is reflected in the fine final product.

Introduction
by Richard M. Ebeling
Austrian economist Ludwig von Mises delivered these nine lectures, which we have titled Marxism Unmasked, from June 23 to July 3, 1952, in San Francisco at a seminar sponsored by The Freeman. A history teacher who received a scholarship to attend the program later wrote to the magazine to say:

The lectures themselves I found provocative, stimulating and highly rewarding. As a classic exposition of the virtues of individualism and the evils of socialism, buttressed with an impressive array of scholarship, they were unmatched. . . . I am not trying to say that I became converted completely to the set of ideas that Dr. Mises and the Freeman represent. But I do say that any student or teacher of the social sciences who fails to think deeply on these ideas is negligent and ill-informed, if not worse. This feeling the seminar did leave me with. Certainly I personally appreciate some of these ideas far more than I did a month ago.[1]

It is worth recalling the state of the world in 1952 when Ludwig von Mises gave these lectures. Everywhere around the globe Soviet socialism seemed to be on the march. World War II had left all of Eastern Europe in the grip of the Soviet Union. In 1949, mainland China had fallen under the control of Mao Zedong’s communist armies. In June of 1950 the Korean War had broken out, and in 1952 American armies under the UN flag were in a bloody stalemate along the 38th parallel against the forces of North Korea and Communist China. The French were immersed in a seemingly endless colonial conflict in Indochina against Ho Chi Minh’s communist guerrilla army.

In the West, large numbers of intellectuals were persuaded that “history” was inescapably on the side of socialism, under the leadership Comrade Stalin in the Kremlin. Communist parties in France and Italy had large memberships, and followed every ideological twist and turn made by Moscow. Even many of those who rejected the brutality of Soviet-style socialism still believed that economic planning was inevitable. A prominent political scientist at the University of Chicago even declared in 1950 that “Planning is coming. Of this there can be no doubt. The only question is whether it will be the democratic planning of a free society, or totalitarian in character.”[2]

In both Europe and the United States it was presumed that capitalism, when left unregulated, could only lead to exploitation, misery, and social injustice. Governments on both sides of the Atlantic were introducing ever more stringent interventionist and welfare statist policies meant to ameliorate the supposed cruelty of the market economy. And because of the “emergency” of the Korean War, the U.S. government had further burdened the American people with a comprehensive system of wage and price controls that hampered almost every aspect of economic activity.[3]

The primary source and impetus for the global bias toward socialism were the writings of Karl Marx (1818–1883). He claimed to have discovered the invariant “laws” of human historical development that would lead to the demise of capitalism and the triumph of socialism, followed by a final transition to a blissful, post-scarcity communist world. During the intermediary socialist stage leading to communism, Marx declared, there would be a “revolutionary dictatorship of the proletariat.” It would prevent remnants of the old capitalist ruling class from trying to return to power and would “reeducate” the workers into a “higher consciousness” free from the residues of the prior bourgeois mentality.[4]

What makes this entire process inescapable and irreversible, Marx insisted, is that the physical means of production follow technological transformations in a series of historical stages that are beyond man’s control. Each of these stages of transformation requires a particular set of human institutional relationships for the full blossoming of that technology’s potential. What men, in their limited and subjective views of the world, take to be the invariant foundations of human life—morality, family, property, religious faith, customs and traditions, and so on—are merely the temporary elements of a societal “superstructure” serving the ends of the objective material forces of production during each of these historical epochs. Therefore, even man’s “consciousness” about himself and the world around him is a product of his particular place and role in this process of historical evolution.[5]

Every man’s “class” position in society, according to Marx, is determined by his relationship to the ownership of the means of production. Those who own the means of production in capitalist society must, by historical necessity, “exploit” the others who offer their labor services to them for hire. The capitalist class lives off the labor of the working class by expropriating as “profit” a part of what the laborers in their employ have produced. Hence, these two social classes are in irreconcilable conflict with each other for the material rewards of human labor. This conflict reaches its climax with the violent overthrow of the exploiters by the proletariat, who experience an increasing economic misery during the final death throes of the capitalist system.[6]

In the new socialist order that replaces capitalism, the means of production will be nationalized and centrally planned for the economic betterment of the vast majority of humanity, and no longer will be used only for the profit-oriented benefit of the capitalist property owners. Economic planning will generate material prosperity far exceeding anything experienced under capitalism; technological advances and rising production will not only eliminate poverty but also push society to a level of material abundance at which all physical wants and worries will be a thing of the past. This final stage of communism will create a paradise on earth for all mankind.[7]

Ludwig von Mises as Critic of Socialism
There were many critics of socialism and Marxism in the nineteenth and early twentieth centuries. One of the most outstanding was the French economist Paul Leroy-Beaulieu, who in 1885 penned an extremely insightful and devastating analysis of collectivism, addressing its dangers to both personal liberty and economic prosperity.[8] In 1896 one of Ludwig von Mises’s own professors at the University of Vienna, the internationally renowned Austrian economist Eugen von Böhm-Bawerk, published the most damaging critique of Marx’s labor theory of value and the accompanying idea of exploitation of labor under capitalism.[9] There were even highly effective anti-utopian novels that depicted the disastrous effects to be expected if a socialist regime were to come to power and impose central planning on society.[10]

But none of these writers was as penetrating in demonstrating the inherent unworkability of a system of socialist central planning as Ludwig von Mises. During World War I and its immediate aftermath there was an enthusiastic confidence that the age of government planning had finally arrived. The wartime price and wage controls and production planning boards imposed in virtually all the belligerent nations were considered by many the precursors of continued peacetime planning. Following the Bolshevik Revolution in Russia in 1917, Lenin’s Marxist regime imposed “war communism” in 1918, heralding it not only as an emergency device to fight the anti-communist White armies during the three-year civil war in Russia, but also as the great leap into the fully planned society. And following the end of the war in November 1918, new Social Democratic Party governments in Germany and Austria declared that the time for “socialization” and economic planning had finally arrived.[11]

In 1919, at a meeting of the Austrian Economic Society, Mises delivered a paper on “Economic Calculation in the Socialist Commonwealth,” which was published in a leading German-language journal in 1920.[12] He incorporated this article as the centerpiece in a comprehensive treatise on collectivism that he published two years later in 1922, titled Socialism: An Economic and Sociological Analysis in its English translation.[13]

Mises observed that most of the earlier critics of socialism had rightly pointed out that a system of comprehensive government planning of economic affairs would create the worst tyranny ever experienced in human history. With all production, employment, and distribution of output completely under the monopoly control of the State, the fate and fortune of every individual would be at the mercy of the political authority. In addition, these earlier opponents of socialism had cogently argued that with the end of private property and freedom of enterprise, individuals would lose much of the self-interested motivation for industry, innovation, and work effort that exists in a market economy.

But, Mises said, what had not been thoroughly examined and challenged was whether a socialist economic system was even workable in practice. In other words, would the socialist central planners be able to rationally and efficiently manage the everyday affairs of economic life? His answer was no. In the market economy production is guided by the expected consumer demand of the buying public. Businessmen and entrepreneurs, in the quest to earn profits and avoid losses, must direct the resources at their disposal in a way that minimizes their costs of production relative to the expected revenues from supplying goods and services that consumers want to purchase.

Money prices for both finished consumer goods and the means of production facilitate the process. The prices for consumer goods tell entrepreneurs what consumers want. The prices for the means of production—land, labor, and capital—tell them the costs of producing those goods with different types of resources and raw materials in different combinations. The entrepreneur’s task is to select that resource “mix” that minimizes the expense of bringing goods to market in the quantities and qualities demanded by consumers.

The price attached to any one of those resources (whether it be land, labor, or capital) reflects its value in alternative uses, as represented by the competing bids to purchase or hire it by rival entrepreneurs who also seek to employ it for some production purpose in the market. Unless the expected price for the finished good is able to cover the costs necessary to employ a variety of resources to produce it, it is uneconomical—wasteful—to devote those resources for its manufacture. As Mises later explained in his book on Bureaucracy, “To the entrepreneur of capitalist society a factor of production through its price sends out a warning: Don’t touch me, I am earmarked for the satisfaction of another, more urgent need” of the consuming public.[14]

This means that the price system of a competitive free market tends to assure that the scarce resources of society are allocated and used in a way that best reflects the wants and desires of all of us in our roles as consumers. Since one of the inescapable elements of the world in which we live is constant change, every shift in consumer demand and every modification in the availability and uses of those scarce resources are reflected in changes in the market structure of relative prices. Such changes in the structure of market prices provide new information to both producers and consumers that they may have to adjust their buying, selling, and production decisions, given the new circumstances.

Mises’s challenge to the socialists was to argue that this “rationality” of the market, which constantly coordinated selling prices with cost-prices, and supply with demand, would be totally absent under a system of central planning. Prices emerge out of the buying and selling of the market participants. But buying and selling are only possible with the institution of private property, under which goods and resources are owned, used, and transferred through voluntary exchange at the discretion of the owners.

Furthermore, under capitalism the complex network of market transactions is made possible through the use of a commonly accepted medium of exchange—money. With all goods and resources bought and sold in the market through a medium of exchange, their respective exchange values are all expressed in terms of the same common denominator: their money prices. This common denominator of money prices enables the process of “economic calculation,” i.e., the comparing of relative costs with selling prices.

The primary goal of practically all socialists in the nineteenth century and most of the twentieth century was the abolition of private property, market competition, and money prices. In their place, the State would nationalize the means of production, and as the “trustee” of the interests of the “working class” would centrally plan all of society’s economic activities. The central planning agency would determine what got produced, how and where it was produced, and then distribute the resulting output to the members of the new “workers’ paradise.”

Mises showed that the end of private property would mean the end to economic rationality. Without private ownership of the means of production—and no competitive market upon which rival entrepreneurs could bid for those resources based on their profit-motivated estimates of their respective values in producing goods desired by the consuming public—there would be no way to know real and actual opportunity costs among the potential alternative uses for which they might be applied. How, therefore, would the central planners know whether or not they were misusing and wasting the resources of society in their production decisions? As Mises summarized the dilemma, “It is not an advantage to be ignorant of whether or not what one is doing is a suitable means of attaining the ends sought. A socialist management would be like a man forced to spend his life blindfolded.”[15]

Even if a socialist system were not controlled by brutal dictators but instead by human “angels” who only wanted to do “good” for humanity, and even if the incentives for work and industry were not reduced or eliminated through the abolition of private property, Mises was able to demonstrate that the very institutional structure of a socialist regime made it impossible for it to produce a material “heaven on earth” for mankind superior to the productive and innovative efficiency of a functioning free-market economy.[16] It is what enabled Mises to declare in the early 1930s, when the appeal of socialist planning around the world was reaching its zenith, that, “From the standpoint of both politics and history, this proof is certainly the most important discovery made by economic theory. . . . It alone will enable future historians to understand how it came about that the victory of the socialist movement did not lead to the creation of the socialist order of society.”[17]

Mises’s San Francisco Lectures
Mises believed that any comprehensive critique of socialism had to deal with more than merely its unworkability as an economic system, however central this was to the case against socialism. It was also necessary to challenge and refute the philosophical and political underpinnings of the socialist and Marxian conceptions of man and society. His 1922 book on Socialism attempted to do this in great detail. And he returned to this theme a few years after he delivered these lectures in San Francisco in his work on Theory and History.[18]

What Mises offered those attending these lectures in late June and early July of 1952 was a clear understanding and insight into the fundamental errors and misconceptions to be found in Marx’s theories of dialectical materialism and class warfare, as well as a historical analysis of the real benefits from the Industrial Revolution that coincided with the emergence of modern capitalist society. He also explains the role of savings, investment, and the profit and loss system as the engines for economic and cultural progress, and which have helped eliminate the poverty that has plagued mankind through most of history.

In an especially insightful lecture, Mises discusses the nature and workings of capital markets and the importance of market-based interest rates free from government manipulation and inflation. In addition, he shows that foreign investment in underdeveloped parts of the world have not been the cause of poverty or exploitation, as socialists have constantly claimed, but the source of accelerated prosperity and human improvement for tens of millions of people in these countries.

All of these arguments and analyses are placed in the wider context of individualism versus collectivism, the importance of freedom for the dignity and betterment of every human being, and the dangers from surrendering liberty and property to the paternalistic state. Through it all, the reader is offered a vision of the classical-liberal ideal of the free and prosperous society.

As with an earlier series of lectures that Ludwig von Mises delivered in 1951, and which was published by FEE under the title The Free Market and Its Enemies,[19] a unique quality of Marxism Unmasked is that it captures Mises as teacher. Unlike many of his longer, more formal writings, these lectures are peppered with numerous historical asides and common-sense examples that convey the ease and spirit of the spoken word.

These lectures, like the earlier ones, were taken down, word for word, in shorthand and then transcribed by Bettina Bien Greaves, a long-time former senior staff member at the Foundation for Economic Education. Mrs. Greaves is one of the leading experts on the ideas and writings of Ludwig von Mises, and her deep appreciation for his contributions to economic theory and policy is reflected in the care with which she transcribed these lectures for eventual publication. They would not be available now in print if not for her dedication and diligent scholarship, for which we are all especially grateful.

When Mises delivered these lectures Marxian socialism seemed to be conquering the world. Despite the fall of the Berlin Wall in 1989 and the collapse of the Soviet Union in 1991, Marxian criticisms of capitalist society still set the tone for those around the world who persistently hope for the end of human freedom and the market economy.[20] For that reason, what Mises had to say more than 50 years ago still has much meaning for us today.

But now, simply enjoy “listening” to the mind of one of the greatest economists of the twentieth century as you read this book.

Last month, I retweeted a comment by a contrarian writer who questioned whether racism was to blame for the spread of the coronavirus, and a close (white) friend responded to me with a well-meaning text:

“I feel it is my calling to help end the oppression people of color like you face in our society,” he wrote. “I understand I have white privilege. And that has consequences.”

His message left me feeling bewildered. What “oppression” had I actually faced? And what “privilege” had society conferred upon my friend because of his white skin?

Growing up as a Sikh, turbaned boy in the majority-white environment of British Columbia, Canada, I was a constant target of bullying throughout my elementary school years. On bus rides home, I remember having to sit in the back where the older, “cool” kids hung out, and they used to jump up and slap the top part of my turban. I was consistently harassed with comments like “Go back to where you came from” and “You don’t belong here.”

Upon immigrating from India when I was 4, my family suffered tremendous economic hardships and cultural challenges. My father drove a taxi at night and my mom worked many menial jobs as a cook, housecleaner, barista and motel cleaner. It’s fair to say my family never had success handed to them on a silver platter. But more than a decade post-immigration, we have found our footing in Western society, with my dad making nearly six figures operating his own software company.

Author Rav Arora was teased as a child for looking different (left) but leveraged his economic privilege to succeed.

Rising from poverty to economic prosperity is a common narrative for immigrants from all backgrounds in the West. For example, after the communist takeover of Cuba in 1959, many refugees fled to America, leaving most of their wealth behind and having to start from the bottom. But by 1990, second-generation Cuban Americans were twice as likely to earn an annual salary of $50,000 than non-Hispanic whites in the United States.

The notion of white privilege stems from the idea that white people have benefited in American history relative to “people of color.” And it’s true that the institution of slavery and the following decades of anti-black dehumanization has a continuing impact today. A major 2013 study from Brandeis University found that 32 percent of the wealth gap between whites and blacks can be attributed to inherited wealth and length of homeownership, two factors linked to institutionalized racism. Meanwhile, Harvard economist Roland Fryer’s much-publicized study on racial bias in policing found that cops are 53 percent more likely to use physical force on black civilians compared to whites (his study, however, found no anti-black bias in fatal police shootings).

Because of facts like these, an emerging definition of white privilege is now being widely circulated on social media: “White privilege doesn’t mean your life hasn’t been hard. It just means your race isn’t one of the things that make it harder.”

And yet, this definition suffers from several shortcomings. For one, it ignores anti-Semitism — the second leading cause of hate crimes in America, according to the FBI. In addition, the growing demonization of whiteness now means that white people are no longer immune to racism. I can think of several instances where friends and colleagues have been racially targeted for being white and holding contrarian but intellectually defensible positions such as “we need to have generous, but reasonable limits on our immigration system” or even “I don’t think racial minorities are systematically oppressed in Western society today.”

Well-meaning white folk often decry their own whiteness as a means of racial protest but many other groups who otherwise have faced severe marginalization are doing better economically.
Well-meaning white folk often decry their own whiteness as a means of racial protest but many other groups who otherwise have faced severe marginalization are doing better economically.Sipa USA via AP
And the concept of white privilege can’t explain why several historically marginalized groups out-perform whites today. Take Japanese Americans, for example: For nearly four decades in the 20th century (1913 – 1952), this group was legally prevented from owning land and property in over a dozen American states. Moreover, 120,000 Japanese Americans were interned during World War II. But by 1959, the income disparity between Japanese Americans and white Americans nearly vanished. Today, Japanese Americans outperform whites by large margins in income statistics, education outcomes, test scores and incarceration rates.

One could argue the successful stories of my family, Cuban Americans and Japanese Americans are cherry-picked cases. But whites are far from being the most dominantly successful group in Western society. A wealth of data collected in a longform Quillette analysis, shows overwhelming white underachievement relative to several minority groups among health outcomes, educational achievement, incarceration rates and economic success.

On the whole, whatever ‘systemic racism’ exists appears to be incredibly ineffectual, or even nonexistent, given the multitude of groups who consistently eclipse whites.
According to median household income statistics from the US Census Bureau, several minority groups substantially out-earn whites. These groups include Pakistani Americans, Lebanese Americans, South African Americans, Filipino Americans, Sri Lankan Americans and Iranian Americans (in addition to several others). Indians, the group I belong to, are the highest-earning ethnic group the census keeps track of, with almost double the household median income of whites. In Canada, several minority groups also significantly out-earn whites, including South Asian Canadians, Arab Canadians and Japanese Canadians.

Interestingly, several black immigrant groups such as Nigerians, Barbadians, Ghanaians and Trinidadians & Tobagonians have a median household income well above the American average. Ghanian Americans, to take one example, earn more than several specific white groups such as Dutch Americans, French Americans, Polish Americans, British Americans and Russian Americans. Do Ghanaians have some kind of sub-Saharan African privilege?

Nigerian Americans, meanwhile, are one of the most educated groups in America, as one Rice University survey indicates. Though they make up less than 1 percent of the black population in America, nearly 25 percent of the black student body at Harvard Business School in 2013 consisted of Nigerians. In post-bachelor education, 61 percent of Nigerian Americans over the age of 25 hold a graduate degree compared to only 32 percent for the US-born population.

These facts challenge the prevailing progressive notion that America’s institutions are built to universally favor whites and “oppress” minorities or blacks. On the whole, whatever “systemic racism” exists appears to be incredibly ineffectual, or even nonexistent, given the multitude of groups who consistently eclipse whites.

Despite set backs such as being prohibited to own land and internment camps, Japanese Americans have been able to close the economic gap and are a story of immigrant success.
Despite being prohibited from owning land in the past and being placed in internment camps during WWII, Japanese Americans have been able to close the economic gap and now outperform whites in the US.Alamy
In fact, because whites are the majority in Canada and America, more white people live in poverty or are incarcerated than any other racial group in those countries. If you were to randomly pick an impoverished individual in America, you are exponentially more likely to pick a white person than a “person of color,” because of population differences. Today, 15.7 million white Americans (almost twice as many as black Americans) live in poverty. Given such facts, why would we deem all white people as privileged, even if whites have lower poverty rates compared to African Americans and Hispanics?

It should also be noted that suicide rates are disproportionately high among the white population. In 2018, whites had the highest suicide rate of 16.03 per 100,000. The New York Times has reported that whites are dying faster than they are being born in a majority of US states — in large part due to high rates of substance abuse and suicide. In comparison, black Americans had a suicide rate less than half of whites (6.96) and Asian Americans/Pacific Islanders had the lowest rate of 6.88 per 100,000. In this context, do blacks and Asians have some kind of unmerited “privilege” they must atone for?

If we look at health outcomes reported by the Centers for Disease Control and Prevention, we find that African Americans are less likely than whites to die of several health conditions such as bladder cancer, leukemia, esophageal cancer, lung cancer, bladder cancer, brain cancer and skin cancer, to take a few arbitrary examples. But no one in their right mind would protest any “health privilege” enjoyed by African Americans in these instances. And while blacks have the highest COVID-19 death rate, more than double that of whites, the group with the lowest death rate from the coronavirus is actually Asian Americans. Given the crisis of the pandemic, perhaps it would be laudable for Asians like me to confess their “Asian privilege” on social media because otherwise, as the Twitter hashtag goes, #SilenceisViolence.

Overall, I can think of several privileges I have benefited from that are arguably more significant than “white privilege.” Roughly speaking my family has more wealth than many in my social circle, including my friend who texted me to atone for his white privilege. This would be a form of class privilege.

By 1990, second-generation Cuban Americans were twice as likely to earn $50,000 a year than non-Hispanic whites in the United States.
By 1990, second-generation Cuban Americans were twice as likely to earn $50,000 a year than non-Hispanic whites in the United States.Alamy
I was also afforded the privilege of taking a full one-year break from education to pursue my passion for creative writing and social commentary. Had I been in a different economic circumstance, I would’ve been forced to immediately attend college or spend a substantial portion of my time working in my gap year. Comparatively, my friend who texted me went to university right away and tenaciously worked part-time on the weekends to afford his tuition. Perhaps it would be more appropriate for me to confess economic privilege to him. I was also afforded the privilege of my parents strongly encouraging me to read books and learn new vocabulary words at a very young age, which has undoubtedly aided me in my freelance journalism career. This kind of “literacy privilege” has, in part, given me the tremendous opportunity to write essays for top publications like The Globe and Mail and The Grammy Awards, despite being just 19 years of age.

Writing this essay, I also have the immense privilege of being a person of color. I receive plentiful backlash for defending the positions I hold, but had I been a white person, I would have easily been demonized as “alt-right” or even a “white supremacist,” despite having average libertarian or classical liberal views on politics.

Fundamentally, privileges of all kinds exist: able-bodiedness, wealth, education, moral values, facial symmetry, tallness (or in other contexts, shortness), health, stamina, safety, economic mobility, and importantly, living in a free, diverse society. Rather than “whiteness,” an exponentially more predictive privilege in life is growing up with two parents.

This is why 41 percent of children born to single mothers grow up in poverty whereas only 8 percent of children living in married-couple families are impoverished. In a racial context, the poverty rate among two-parent black families is only 7.5 percent, compared to 11 percent among whites as a whole and 22 percent among whites in single-parent homes. In fact, since 1994 the poverty rate among married black Americans has been consistently lower than the white poverty rate. Furthermore, an illustrative study published in the Journal of Marriage and Family found that when controlling for family structure, the black-white poverty gap is reduced by over 70 percent.

Privileges of all kinds exist: able-bodiedness, wealth, education, facial symmetry, health, stamina, safety, economic mobility, and importantly, living in a free, diverse society.
When surveying the tremendous complexity of racial disparities, it’s simply wrong to presuppose all whites are “privileged,” let alone racist. Using the despicable actions of a few to judge an entire group of people is never sound reasoning. Just because some white people (who were kids) weaponized their whiteness and harassed me for the color of my skin, doesn’t mean I view all white people as racist or privileged.

None of the statistics in this piece discount racial prejudice, unequal opportunities or the privilege of not experiencing racism. They simply point to the glaring fallacies of the all-consuming white-privilege narrative which has degraded our national discourse into identity politics and racial tribalism. White people are now one-dimensionally seen as an undifferentiated mass of privilege and wealth whereas minorities are seen as powerless victims oppressed by a society ingrained with white supremacy and racial bigotry.

Ultimately, I don’t want to be treated as “Rav, the brown-skinned boy” or “Rav, the underprivileged minority.” I want to be treated as an individual with a unique set of circumstances and characteristics. To cohere as a multiethnic, pluralistic society this standard must be applied to all colors and ethnicities. But until we collectively repudiate race-based stereotyping and fallacious, inflammatory generalizations, we shift the focus away from real inequity and discrimination — and never truly make progress.

Rav Arora is a 19-year-old writer based in Vancouver, Canada, who specializes in topics of race, music, literature and culture. His writing has also been featured in The Globe and Mail and City Journal.

Some of the most dangerous big cities are: St. Louis, Detroit, Baltimore, Oakland, Chicago, Memphis, Atlanta, Birmingham, Newark, Buffalo and Philadelphia. The most common characteristic of these cities is that for decades, all of them have been run by liberal Democrats. Some cities — such as Detroit, Buffalo, Newark and Philadelphia — haven’t elected a Republican mayor for more than a half-century. On top of this, in many of these cities, blacks are mayors, often they dominate city councils, and they are chiefs of police and superintendents of schools.

In 1965, there were no blacks in the U.S. Senate, nor were there any black governors. And only six members of the House of Representatives were black. As of 2019, there is far greater representation in some areas — 52 House members are black. Nine black Americans have served in the Senate, including Edward W. Brooke of Massachusetts, Carol Moseley Braun and Barack Obama of Illinois, Tim Scott of South Carolina, Cory Booker of New Jersey, and Kamala Harris of California. In recent times, there have been three black state governors. The bottom line is that today’s black Americans have significant political power at all levels of government. Yet, what has that meant for a large segment of the black population?

Democratic-controlled cities have the poorest-quality public education despite their large, and growing, school budgets. Consider Baltimore. In 2016, in 13 of Baltimore’s 39 high schools, not a single student scored proficient on the state’s math exam. In six other high schools, only 1% tested proficient in math. Only 15% of Baltimore students passed the state’s English test. That same year in Philadelphia only 19% of eighth-graders scored proficient in math, and 16% were proficient in reading. In Detroit, only 4% of its eighth-graders scored proficient in math, and 7% were proficient in reading. It’s the same story of academic disaster in other cities run by Democrats.

Violent crime and poor education is not the only problem for Democratic-controlled cities. Because of high crime, poor schools and a less pleasant environment, cities are losing their economic base and their most productive people in droves. When World War II ended, the population of Washington, D.C., was about 800,000; today, it’s about 700,000. In 1950, Baltimore’s population was almost 950,000; today, it’s around 590,000. Detroit’s 1950 population was close to 1.85 million; today, it’s down to 673,000. The population of Camden, N.J., in 1950 was nearly 125,000; today it has fallen to 74,000. St. Louis’ 1950 population was more than 856,000; today, it’s less than 294,000. A similar story of population decline can be found in most of our formerly large and prosperous cities. In some cities, the population decline since 1950 is well over 50%, and that includes Detroit, St. Louis, Cleveland and Pittsburgh.

Academic liberals, civil rights advocates and others blamed the exodus on racism — “white flight” to the suburbs to avoid blacks. But blacks have been fleeing some cities at higher rates than whites. The five cities whose suburbs have the fastest-growing black populations are Miami, Dallas, Washington, Houston and Atlanta. It turns out that blacks, like whites, want better and safer schools for their kids and don’t like to be mugged or have their property vandalized. And like white people, if they have the means, black people cannot wait to leave troubled cities.

White liberals and black politicians focus most of their attention on what the police do, but how relevant is that to the overall tragedy? According to Statista, this year, 172 whites and 88 blacks have died at the hands of police. To put police shootings in a bit of perspective, in Chicago alone in 2020 there have been 1,260 shootings and 256 homicides with blacks being the primary victims. That comes to one shooting victim every three hours and one homicide victim every 15 hours. Three people in Chicago have been killed by police. If one is truly concerned about black deaths, shootings by police should figure way down on one’s list — which is not to excuse bad behavior by some police officers.

Walter E. Williams is a professor of economics at George Mason University and a columnist for Creators Content Agency.

Joe Biden says there’s no miracle cure for COVID coming. So what’s his solution? To learn to live like rational human beings when there are always viruses in the world? Like we did with H1N1, when he was vice president? No way. Instead, he wants unlimited lockdowns, unlimited national mask mandates and economic collapse. Of course, his policies of socialism and the Green New Deal would have taken us back to 1895 anyway, causing millions and millions of deaths.

Economic collapse is WAY more lethal than a virus with a 99 percent survival rate. What he’s running on is COVID Communism. Same end goal, only with a virus as the excuse.

Continue reading →

While it might not be popular to say in the wake of the recent social disorder, the true plight of black people has little or nothing to do with the police or what has been called “systemic racism.”

Instead, we need to look at the responsibilities of those running our big cities.

Some of the most dangerous big cities are St. Louis, Detroit, Baltimore, Oakland, Chicago, Memphis, Atlanta, Birmingham, Newark, Buffalo and Philadelphia. The most common characteristic of these cities is that for decades, all of them have been run by liberal Democrats.

Some cities — such as Detroit, Buffalo, Newark and Philadelphia — haven’t elected a Republican mayor for more than a half-century. On top of this, in many of these cities, blacks are mayors, often they dominate city councils and they are chiefs of police and superintendents of schools.

In 1965, there were no blacks in the U.S. Senate, nor were there any black governors. And only six members of the House of Representatives were black.

As of 2019, there is far greater representation in some areas — 52 House members are black. Nine black Americans have served in the Senate, including Edward W. Brooke of Massachusetts, Carol Moseley Braun and Barack Obama of Illinois, Tim Scott of South Carolina, Cory Booker of New Jersey, and Kamala Harris of California. In recent times, there have been three black state governors.

The bottom line is that today’s black Americans have significant political power at all levels of government. Yet, what has that meant for a large segment of the black population?

Democratic-controlled cities have the poorest-quality public education despite their large, and growing, school budgets.

Consider Baltimore. In 2016, in 13 of Baltimore’s 39 high schools, not a single student scored proficient on the state’s math exam. In six other high schools, only 1% tested proficient in math. Only 15% of Baltimore students passed the state’s English test.

That same year in Philadelphia, only 19% of eighth-graders scored proficient in math, and 16% were proficient in reading. In Detroit, only 4% of its eighth-graders scored proficient in math, and 7% were proficient in reading. It’s the same story of academic disaster in other cities run by Democrats.

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Violent crime and poor education are not the only problems for Democratic-controlled cities.

Because of high crime, poor schools and a less pleasant environment, cities are losing their economic base and their most productive people in droves.

When World War II ended, the population of Washington, D.C., was about 800,000; today, it’s about 700,000. In 1950, Baltimore’s population was almost 950,000; today, it’s around 590,000. Detroit’s 1950 population was close to 1.85 million; today, it’s down to 673,000. The population of Camden, New Jersey, in 1950 was nearly 125,000; today it has fallen to 74,000. St. Louis’ 1950 population was more than 856,000; today, it’s less than 294,000.

A similar story of population decline can be found in most of our formerly large and prosperous cities. In some cities, the population decline since 1950 is well over 50%, and that includes Detroit, St. Louis, Cleveland and Pittsburgh.

Academic liberals, civil rights advocates and others blamed the exodus on racism — “white flight” to the suburbs to avoid blacks. But blacks have been fleeing some cities at higher rates than whites.

The five cities whose suburbs have the fastest-growing black populations are Miami, Dallas, Washington, Houston and Atlanta. It turns out that blacks, like whites, want better and safer schools for their kids and don’t like to be mugged or have their property vandalized.

And like white people, if they have the means, black people cannot wait to leave troubled cities.

White liberals and black politicians focus most of their attention on what the police do, but how relevant is that to the overall tragedy?

According to Statista, this year, 172 whites and 88 blacks have died at the hands of police. To put police shootings in a bit of perspective, in Chicago alone in 2020, there have been 1,260 shootings and 256 homicides with blacks being the primary victims. That comes to one shooting victim every three hours and one homicide victim every 15 hours. Three people in Chicago have been killed by police. If one is truly concerned about black deaths, shootings by police should figure way down on one’s list — which is not to excuse bad behavior by some police officers.

Walter E. Williams is a professor of economics at George Mason University.