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Me, Murray, and Milton

While I was debating Lord Skidelsky in London yesterday, Milton Friedman's son David posted this response to Lew Rockwell's assertion that his father "is almost nobody outside of mainstream economics."

David's reply has elicited many responses, including a few referring to yours truly not, thank goodness, as a Rothbardian, but as a self-styled "Austrian" economist. As David seemed to be under the impression that that characterization was correct, I added my own comment, which I reproduce here for the sake of further distancing myself from Austrian disparagers of the late, great Uncle Milty:

David, for the record, I don't "describe myself as an Austrian," and haven't done so since graduate school. Indeed, I consider myself no less a fan of your dad's work than I am of work by Hayek and Mises. I think a good economists [sic] cannot concern himself or herself with belonging to any school, or being loyal to one. I'm pretty sure your dad would have said the same. It was others who labelled him a "Chicago" economist, while the only label he sought was "good" economist.

Rothbard, on the other hand, was only too determined to identify himself with the Austrian School and, more than that, to both take part in a personality cult, built around von Mises, and attract such a cult himself. One sign of the presence of such a cult is precisely the scorn its members heap on potential rivals to the cult figure.

As a monetary economist (I don't pretend to judge Rothbard's other economic contributions) Rothbard was mediocre to bad. His version of the Austrian business cycle theory was naive–in essence it equated behavior of M consistent with keeping interest rates at their "natural" levels with the elimination of fractional-reserve banking, an equation that holds only with the help of about a dozen auxilliary assumptions, all of which are patently false. He then went on to conjure up an equally false history of banking and of bank contracts designed to square his theory of the cycle, with its implied condemnation of fractional reserve banking, with his libertarian ethics.

Thanks to all this nonsense people like myself and Larry White (who does still call himself an Austrian) have to waste oodles of time debunking his ideas–we most certainly haven't simply "ignored" them–that we'd rather spend attacking central bankers' shenanigans.

To add to the record, I had the privilege of getting to know both Murray and Milton. Like most people who encountered him while in their "Austrian" phase, I found Murray a blast, not the least because of his contempt for non-Misesians of all kinds. Milton, though, was exceedingly gracious and generous to me even back when I really was a self-styled Austrian. For that reason Milton will always seem to me the bigger man, as well as the better monetary economist.

Follow-Up: A blog styling itself the EconomicPolicyJournal insists that my blog and comments together amount to a logical muddle. For the record (and in case the "EPJ" (sounds even better, doesn't it!) finds it unworthy of…er…publication, I replied by noting that if there was an error of logic the esteemed journal itself was gulty of it, since, far from being the same as Rothbard's ideal, Friedman's frozen base proposal did not (1) call for a gold standard, (2) call for abolishing fractional-reserve banking, or (3) call for a constant stock of money in the usual sense meaning a constant stock of public money holdings.