Fun With Austrians: Major Freedom and Herman Hoppe

      If you spend any time at Money Illusion you are aware of certain characters. One that you may have noticed is Major Freedom, a cranky old Austrian who never tires on lecturing against any kind of stimulus to the demand shortfall.

     This is because Austrians don't believe in the idea of a shortfall in demand. They think it's impossible-literally they think Say was right. There's no such thing as a demand shortfall it's always about supply. If you leave the market to do its work eventually a collapse in prices will enable consumption to rise up again. I notice that a lot of these Austrian guys always sound the same. So for kicks I was over at the Mises Daily website and read something by who else-Johnnie Cochran invoking Say's Law.

    Then in the archives there was this interview of who else-Herman S. Hoppe. This interview should stem the idea that Austrianism is anything mild. Not so long ago Naked Capitalism had a series of mock interviews where Hoppe was quoted. For those who think he may have been taken out of context, that the interview was surely a parody take a look at what he said in an interview in Austrian world:

    Mr. Hoppe has figured out the crux of our problem things are going to have to get a lot worse politically and economically before they get better again:

    "Unfortunately, I’m afraid so. Before that we’ll probably have to experience national bankruptcy spreading through Portugal, Spain, Italy and ultimately on to Germany. Only then, I fear, will it become clear to everyone what many people already suspect now: that the EU is nothing but a gigantic machinery of income and wealth redistribution, from Germany and the Netherlands to Greece, Spain, Portugal, and so on. But that’s not all. It will also become clear that the same insanity, the same mess, exists even within each individual country: redistribution from Bavaria and Baden-Württemberg to Bremen and Berlin, from Little Town A to Little Village B, from one company or industry to another, from Smith to Jones and so on – and always following the same perverse pattern: redistribution from the more productive countries, regions, places, companies and individuals to those that are less productive or not productive at all. Bankruptcy will bring all of this to light in a dramatic fashion."

     "And perhaps then, finally, will come the realization that democracy – in whose name all these dirty tricks have been done – is nothing more than an especially insidious form of communism, and that the politicians who have wrought this immoral and economic madness and who have thereby enriched themselves personally (never, of course, being liable for the damages they have caused!), are nothing more than a despicable bunch of communist crooks."

   
    
    http://thegodthatfailed.org/2012/05/31/professor-hoppes-new-book-der-wettbewerb-der-gauner-the-competition-of-crooks/

      See for those of you who thought the Naked Capitalism was a joke it's all here. The problem is democracy that is an "especially insidious" form of commnunsim. Worth remembering that none of the communist inspired states so far have been in any way democratic. The Soviet Union's whole basis was the liquidation of opposing parties-the Mensheviks, the Social Revolutionaries-the Bolsheviks were the Party that represented the Dictatorship of the Proletariat.

     Major Freedom claims that when I mention communist references to his Austrianism I'm "posioning the well"-that Austrianism is the furthest thing from Communism. Maybe, maybe not. Remember there's a point where you end up back where you started from-the furthest you can get away from a point is 180 degrees. On the 181st degree you are already coming back home.

    One of the things that's always struck me about the Extreme Right is that they are so virulently anti Communist that their own mode of organization and tactics begins to ape and mirror Communism itself. So in the 1950s the McCarthyites and then the Birchers begun to instigate the American version of Stalin's Show Trials. The nadir was when Robert Welch the leader of the Birchers even fingered Dwight Eisenhower and his Administration and the Pentagon as Communists.

   What was very interesting is when people were incredulous about such absurd accusations Welch came back with while it may be true that Eisenhower was not literally a Communist agent-ie, subjectively he was not a Communist agent-nevertheless objectively he was. This is right out of Marxist-Leninist and Stalinist ideology. That maybe I didn't shoot the President but on some level I wanted to-so I objectively did shoot him.

    Interestingly the Major recently indicated that he's a Bircher or at least he's highly sympathetic to them as protecting and upholding "Western Civilization."  Makes you think of Jeff Foxworthy's "You Might Be a Redneck" substituting Bircher for Redneck.

     Anyway back to the inimitable Hermann Hoppe. Incidentally the comments section to the interview reads "Leave an Intelligent and Civil Reply." Is this not Right wing ideology par excellence? It's always the Right that is concerned about this-why is this? No doubt they might like to think this is because they are so much more intelligent and civil than their opponents though this is not the real reason...

    "I go even further in my views than Mises. I maintain, and have tried to provide evidence of this in many different ways in my writings, that it is democracy which is causally responsible for the fatal conditions afflicting us now. The number of productive people is constantly decreasing, and the number of people parasitically consuming the income and wealth of this dwindling number of productive people is increasing steadily. This can’t work in the long run."

    "liberated from such parasitism."

     Now when I suggest that Right wing anti-Communism at some point morphs into a rough resemblance of Communism consider this:

      "If, and when, this insight finally bears fruit will depend upon the class consciousness of the population. There is a Marxist myth, eagerly promoted by the state, of an irreconcilable clash of interests between employers (capitalists) and employees (workers), or between the rich and the poor. As long as this myth prevails in public opinion, nothing at all will change and disaster is inevitable."

     See-he even adopts the idea of raising class consciousness. As noted above conservatives have a way of saying very provocative things like Charles Murray that Black people are genetically inferior and so not worth all the state money wasted on them-that is they are the worst of Hoppe's parasites-or Hoppe himself when he declares that democracy is the problem that it is the worst form of Communism-and then you aren't allowed to call them on it or react with the dismay such vile statements deserve as to do so would be uncivil.

    Yes what is the writing off of billions of people the world over-who are of dubious Whiteness-compared to the unpleasantness of a Charles Murray or a Herman Hoppe suffering an uncivil moment?

     Another symptomatic tactic is this:

      "My statement was not intended as a criticism of “John Doe”, but as a simple statement of fact. I think it is completely normal that most people never concern themselves with philosophical questions. Only a few people are ever interested in such questions, and even fewer people have the intellectual capacity to actually clarify or even solve these problems."

      "On the contrary, my comments were intended to systematically encourage John Doe. To tell him, and this is coming from an intellectual, an insider so to speak, that his popular prejudice against intellectuals – that as a rule they are worthless gasbags and smartasses – is quite right. That there are far too many intellectuals, because the state pays for and subsidises them via taxes taken from rest of us. That this colors and distorts the object and result of their thinking – towards statism. That it is he, the average consumer, who has to pay for the whole wasteful nonsense, and that therefore he has every reason to cry out and be indignant."

      I honestly want to give tribute to Mr. Hoppe I mean that sincerely. He manages to insult the average Joe-or in his rendering John Doe-as not being capable of the brain work of people like himself while at the same time effecting to say "screw the intellectual elites! They've sucked long enough at the public teat! They're all smartasses and gasbags"

     To insult John Doe in the same breath as appealing to his anti-intellectualism is impressive. It's the usual pseudo Populist Right wing tactic. Very well done. And this in a piece where he declares that he wants to take the vote of this same John Doe. John Doe can express himself as a consumer.  What other rights may this John Doe have in this libertarian society with no more democracy? How can he get justice before the Law?

      "The basic idea is quite simple. Abolish monopoly and encourage competition.
Currently, it is the case that in the event of a conflict between a citizen and the state, it is always the state (or a state-employed judge) that decides who is in the right. If the state decides, for example, that I owe it more taxes and it forbids me to allow people to smoke in the restaurant I own, and I do not agree with either of these pronouncements, then what can I do about it? I can only go to a state court of law, staffed by judges who themselves are paid from taxes to enforce government regulations. And what will these judges in all probability decide? That all of this is legal, of course! In this way, government-staged robbery, assault, manslaughter, murder, war is “legally” sanctioned. Just try and charge Messrs. Bush or Obama, or our own Angela Merkel for aiding and abetting murder and mayhem in Iraq or Afghanistan. Such a lawsuit would probably never even be taken on by the courts, and the outcome would in any case be clear from the outset, even if it were accepted: acquittal!"

     "In a private law society, if we had such a conflict, we would instead approach arbitrators who are independent of both parties, and who are competing with other arbitrators for voluntarily paying customers. We would not use an inherently biased judge working for and paid directly by the state, who is therefore partisan, but rather a neutral third party, to adjudicate the normal human legal conflicts arising between existing and recognized property rights and private contract law."

     "Such a third party will want to earn and keep its reputation as a neutral impartial judge, in order to avoid being ousted- for lack of clients – from the mediation market. The judgment, in this case, will be predictable and clear: My income from my work is my property (not the state’s) and the restaurant is my property (not the state’s). Therefore, any government-imposed tax upon me or use restrictions upon my property (such as a smoking ban) would therefore be judged unlawful, as robbery and expropriation. And of course, Bush, Obama, Merkel (and many more) would be declared guilty of aiding and abetting murder and manslaughter (among countless other offenses)."

     However will such a third party be available for John Doe? Only if he's a John Doe with deep pockets. If not he's SOL(Shit out of Lock).

     This whole anti-democratic idea is interesting in the sense that Hoppe's non-democratic society will be better for capitalism-for both capital and workers. Yet isn't the reality that liberal democracy is the form that truly fits capitalism? In the pre-democratic age we didn't have fully developed capitalism. Somehow some sort of quasi-feudalistic society will do it better. This is not history for one thing. And it is doubtful in any case. In reality Hoppe's non-democratic society has the same problem that the Communist regimes have always had-capitalism and democracy tend to go together.

     Finally it goes without saying that Hoppe will do away with paper, fiat money with it's insidious inflationary redistribution:

    "Only the state-approved central bank may produce money, and the money is correspondingly bad. Instead of having gold and silver as in former times, we have at present nothing other than paper money all over the world (dollars, euros, yen, etc.). That’s great for the monopolist. He can print money effectively free of charge and buy expensive goods with it such as houses and cars. A veritable magic wand! Who wouldn’t want such a wand? However, for everyone else, it’s not fantastic at all. More paper money doesn’t make a society richer overall. It’s just more paper. But every new piece of printed paper reduces the purchasing power of all the other previously-existing paper bills. And every newly printed bill causes a redistribution of social wealth. The money printers enrich themselves and their share of society’s wealth increases. They now own houses and cars that they previously did not own. And equally, this money printing reduces the wealth of everyone else, who now own correspondingly fewer houses and cars."

     "I’m confident that John Doe is able to realize that these machinations, taking place every day on an almost unimaginable scale, are nothing more than a gigantic case of fraudulent theft.
But the truth is, we don’t hear anything about this fraud from our pretentious, unintelligible and arrogant so-called economic and financial experts on radio, television, and other mainstream media. This is either because they are being paid to consciously withhold or obscure the facts against their better judgment,; or because they were so dumbed down during their time at university, that they are in fact incapable of recognising even the simplest facts and relationships."

     "What would happen if the government’s money monopoly were abolished and we were all allowed to make perfect copies of the state’s paper money (in the same way anyone is at present allowed to produce perfect copies of apples, pears, grains of wheat, nails, houses, computers, and so on)? What would happen is this: paper money would immediately be produced in such quantities that the value (purchasing power) of a paper bill would fall overnight to the bare physical value of the paper itself! With such bills only being worth the paper they’re printed on, they would be unfit for use as a general means of payment. Paper money would disappear as money, and the state would lose its magic wand at a stroke. (This is precisely why the government insists so jealously on its monopoly of printing money!)But this doesn’t mean that money would no longer exist. Rather, in a competitive environment, a better kind of money would be produced. Why? Because there’ll always be a demand for means of exchange."

     "Why do people hold money? Why aren’t all their assets invested in the form of consumer goods and capital goods? Why is there usually a portion of their assets held simply as money (which is neither consumed nor used for other production purposes, but just held as money, in order to perhaps exchange it later for something else)? Answer: Because there is uncertainty in our world. Because things happen and human needs then arise, which neither reserves of consumer and capital goods, nor insurance provisions, can prepare us for, or stop from happening. The only way to be prepared for such unpredictable, yet constantly recurring surprises, and the ensuing needs, is to set up a reserve of means of exchange. A reserve of goods which are distinguished by their exceptional marketability. And which can be directly and immediately exchanged at any time for the widest possible range of any consumer or producer goods."

     "From a historical point of view, these goods were gold and silver, because they best fulfilled the function of a means of exchange to provide “uncertainty insurance”. Gold and silver had emerged as the goods with the highest marketability. They were the most easily salable and most widely accepted of all goods. And so money was therefore either gold or silver."

     "If the government paper money monopoly should ever disappear, gold and silver would most likely recover their former roles as money (and paper would simply play the role in the new monetary system that it always used to have: namely to act as title deeds, or exchange certificates, for gold and silver)."

      Ok well enough levity for now. For those who think representing the views of Hoppe somehow is unfair to Austrianism by taking him for being representative consider this whole interview was conducted by MisesInfo and at no part did the interviewer push back on any point or even ask for much clarification.