Mises And Austrian Economics - A Personal View - By Ron Paul 1984-2004

nder the predominance of interventionist ideas, a political
career is open only to men who identify themselves with the
interests of a pressure group. . . . Service to the short-run interests
of a pressure group is not conducive to the development of those
qualities which make a great statesman. Statesmanship is invari-
ably long-run policy; pressure groups do not bother about the
long-run.
1
I decided to run for Congress because of the disaster of wage and
price controls imposed by the Nixon administration in 1971. When the
stock market responded euphorically to the imposition of these con-
trols and the closing of the gold window, and the U.S. Chamber of
Commerce and many other big business groups gave enthusiastic
support, I decided that someone in politics had to condemn the con-
trols, and offer the alternative that could explain the past and give
hope for the future: the Austrian economists’ defense of the free mar-
ket. At the time I was convinced, like Ludwig von Mises, that no one
could succeed in politics without serving the special interests of some
politically powerful pressure group.
Although I was eventually elected, in terms of a conventional polit-
ical career with real Washington impact, he was absolutely right. I
have not developed legislative influence with the leadership of the
Congress or the administration. Monies are deliberately deleted from routine water works bills for my district because I do not condone the
system, nor vote for any of the appropriations.
My influence, such as it is, comes only by educating others about
the rightness of the free market. The majority of the voters in my dis-
trict have approved, as have those familiar with free-market econom-
ics. And voters in other districts, encouraged by my speaking out for
freedom and sound money, influence their representatives in the
direction of a free market. My influence comes through education, not
the usual techniques of a politician. But the more usual politicians in
Congress will hardly solve our problems. Americans need a better
understanding of Austrian economics. Only then will politicians
become more statesmanlike.
My introduction to Austrian economics came when I was studying
medicine at Duke University and came across a copy of Hayek’s The
Road to Serfdom.
2 After devouring this, I was determined to read what-
ever I could find on what I thought was this new school of economic
thought—especially the work of Mises. Although the works were
magnificent, and clarified many issues for me, it was more of a reve-
lation to find intellectuals who could confirm what I “already
knew”—that the free market is superior to a centrally planned econ-
omy. I did not know how a free market accomplished its work, and so
the study of economics showed me this, and how to build a case for
it. But, like many people, I did not need to be convinced of the merits
of individual freedom—for me that came naturally.
For as long as I can remember, I wanted to be free from govern-
ment coercion in any form. All my natural instincts toward freedom
were inevitably challenged by the established school system, the
media, and the government. These systems tried to cast doubt on my
conviction that only an unhampered market is consonant with indi-
vidual liberty. Although reassured that intellectual giants like Mises
agreed with a laissez-faire system, I was frustrated by knowing what
was right, while watching a disaster developing for our economy. The better I came to understand how the market worked, the more I saw
the need to implement these ideas through political action.
Political action aimed at change can, of course, take various forms.
In 1776, in America, it was a war for independence from British
oppression. In 1917, in Russia, violence was used to strengthen
oppression.
Fortunately, it is possible to accomplish the proper sort of change
through education, persuasion, and the democratic process. Our
rights of free speech, assembly, religion, petition, and privacy remain
essentially intact. Before our rights are lost, we must work to change
the policies of 70 years of government interventionism. And the
longer we wait the harder it will be.
Because of my interest in individual liberty and the free market, I
became closely associated over the years with friends and students of
Mises, those who knew the greatness of Mises from a long-term per-
sonal friendship with him. My contact, however, was always through
his writings, except on one occasion. In 1971, during a busy day in my
medical office, I took a long lunch to drive 60 miles to the University
of Houston to hear one of the last formal lectures Mises gave—this
one on socialism. Although 90 at the time, he was most impressive,
and his presentation inspired me to more study of Austrian econom-
ics.
My subsequent meetings and friendship with the late Leonard
Read and his Foundation for Economic Education also inspired me to
work harder for a society unhampered by government intrusion into
our personal and economic lives. My knowledge has been encour-
aged and bolstered through the extraordinary work of the Mises Insti-
tute, with its many publications and conferences, and its inspiring
work among students choosing academic careers.
My friendships with two important students of Mises, Hans Senn-
holz and Murray Rothbard, were especially helpful in getting first-
hand explanations of how the market functions. They helped me to
refine my answers to the continual barrage of statist legislation that
dominates the U.S. Congress. Their personal assistance was invalu-
able to me in my educational and political endeavors.